Maharashtra Seamless - Q1FY21 Result Update - ICICI Securities

Maharashtra Seamless (MSL) reported an operationally steady performance for Q1FY21 wherein the company was able to maintain its EBITDA margins despite a challenging market scenario. Consolidated topline for the quarter was at Rs. 459 crore (down 34% YoY, 22% QoQ). Seamless pipe sales volume for the quarter was at 44900 tonnes (down 36% YoY, 34% QoQ). Similarly, ERW volumes for the quarter were at 13184 tonnes (down 18% both QoQ as well as YoY). On a consolidated basis, the company reported an EBITDA margin of 22.0% (compared to 22.2% in Q1FY20, 17.7% in Q4FY20). Consolidated EBITDA was at Rs. 101 crore (down 3% QoQ, 35% YoY). For the consolidated operations, for the quarter, depreciation expense were at Rs. 29 crore (up 4% QoQ, 45% YoY), finance cost was at Rs. 16 crore (up 13% QoQ but down 12% YoY) while other income was at Rs. 17 crore (down 10% YoY). Ensuing consolidated PAT for the period was at Rs. 45 crore (down 41% YoY).

Valuation & Outlook

For Q1FY21, MSL reported an operationally steady performance. For the quarter, consolidated EBITDA margins were at 22.0% (22.2% in Q1FY20 and 17.7% in Q4FY20). Going forward, we model consolidated operating margins of 19.7% for FY21E and 20.6% for FY22E. We value the stock at 5x FY22E EV/EBITDA and arrive at a target price of Rs. 265. We maintain our HOLD rating on the stock.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_MahaSeamless_Q1FY21.pdf

Shares of MAHARASHTRA SEAMLESS LTD. was last trading in BSE at Rs.240.8 as compared to the previous close of Rs. 248.65. The total number of shares traded during the day was 21436 in over 869 trades.

The stock hit an intraday high of Rs. 251.95 and intraday low of 238.3. The net turnover during the day was Rs. 5234872.

Source : Equity Bulls

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