Ashoka Buildcon - Q4FY21 First Cut - ICICI Direct

(CMP: Rs. 99; MCap: Rs. 2,786 crore)

Ashoka Buildcon reported better than expected PAT largely led by superior reported margins. The topline growth, however was tad lower than expectations.

Q4FY21 Earnings Summary

- Standalone revenue improved 10.5% YoY to Rs. 1,387 crore (vs. I-direct estimate of Rs. 1,405 crore, ~12% growth) with growth driven by pick-up in execution

- EBITDA margin stood at 14.5% (down 374 bps YoY), as the base quarter had certain provision write-backs. Consequently, operating profit declined 12.1% on YoY basis to Rs. 201 crore. We note that margin stood better than our estimate of 12%, which could be possibly owing to some provision write backs, on which we seek clarity

- PAT declined 9.2% YoY to Rs. 149.2 crore (vs. expectation of Rs. 123.8 crore) with beat mainly driven by superior reported EBITDA

- Ashoka's order book at the end of Q3FY21 was at Rs. 9,152 crore, with book to bill ratio of 2.4x on TTM basis. Additionally, the company has secured projects worth ~Rs. 2,580 crore post December'20, strengthening its order position. The recent order wins includes a) six laning EPC road project at Punjab having order book value of Rs. 726 crore, b) 2,000 social housing project at Maldives on EPC basis having job value Rs. 1,018 crore, c) Gauge conversion and electrification project from Gujarat Rail Infrastructure Development Corporation for the cost of Rs. 334 crore, and d) EPC package of 150 MW solar PV project in Rajasthan having project cost of Rs. 502 crore

While Ashoka Buildcon's performance stood decent in Q4, the SBI-Macquarie stake exit, asset monetization and order inflows issue remains the key overhang on the company. We await management commentary on future outlook, order inflow, impact of state-wise lockdown on key projects and monetisation plans. We will review our estimates and come out with a detailed report post the conference call.

Shares of ASHOKA BUILDCON LTD. was last trading in BSE at Rs.98.3 as compared to the previous close of Rs. 99.25. The total number of shares traded during the day was 175678 in over 1862 trades.

The stock hit an intraday high of Rs. 101.6 and intraday low of 96.45. The net turnover during the day was Rs. 17451172.

Source : Equity Bulls

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