Q3FY21 Company Update - Nesco Ltd - ICICI Direct

Nesco's 9MFY21 (and Q3FY21) performance was impacted by virtual closure of Bombay Exhibition Centre (BEC), which was used for Covid Care by BMC and subsequent minimal take-off in hospitality (foods & own events business). For Q3FY21, revenues declined 28.3% YoY at Rs. 82.5 crore, largely impacted by 91.3% decline in BEC revenues and ~53.2% decline in hospitality segment. EBITDA at Rs. 52.9 crore was down 31.6% YoY. PAT at Rs. 48.9 crore for Q3FY21 was down 29.2% YoY.

Valuation & Outlook

We like Nesco, given the prudent management pedigree, steady & planned expansion across verticals funded largely through internal accruals and niche profitable business model including foods/own events etc. Post a washout FY21 for exhibition, we expect gradual recovery from H1FY22 as pandemic effect fades completely. The IT park business is also likely to get a boost as occupancies improve in FY22. We maintain BUY rating on the stock with an SoTP target price of Rs. 745/share (Rs. 650, earlier).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Nesco_CoUpdate_Feb21.pdf

Shares of NESCO LTD. was last trading in BSE at Rs.593.05 as compared to the previous close of Rs. 600.1. The total number of shares traded during the day was 10017 in over 652 trades.

The stock hit an intraday high of Rs. 598.5 and intraday low of 586.4. The net turnover during the day was Rs. 5925900.

Source : Equity Bulls

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