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May 22, 2013, 11.17 AM IST | Source: CNBC-TV18

Here's what to expect from Thermax in Q4

Capital goods maker Thermax is expected to post 11% decline in its March quarter profit as big-ticket orders were hard to come by in preceding quarters.

Capital goods maker Thermax is expected to post 11.1 percent year-on-year decline in its March quarter profit to Rs 115 crore as high margin orders were hard to come by in preceding quarters. The Pune-based company is likely to report around 8.7 percent decline in total income due to sluggish demand scenario that prevailed throughout FY13, according to CNBC-TV18 poll

EBITDA ( earnings before interest, tax, depreciation and amortization) is also seen down 13.1 percent to Rs 161 cr. Operating margins are also seen down 50 bps to 10.5 percent YoY

Factors at play during Q4 for Thermax which will announce numbers on Wednesday

*Lack of incremental orders has led to a rapidly declining order book-to-bill ratio, resulting in their revenue momentum tapering off consistently for quarters

*While the company will continue to benefit from softening commodity prices as seen till 9MFY13

*Execution of small ticket low margin orders could impact margins on the downside

*Order inflow could be weak due to lack of any large order wins in the quarter

*Order intake has picked up from the lows and is sustaining at Rs 1,200 1,400 crore per quarter

* In Q4, there has been no major order win announced by the company. 

 *However, for the full fiscal expect the co to report a modest growthLosses in subsidiaries has impacted the overall bottomline (down 25 percent YoY over 9MFY13)

*The firm is incurring losses in subsidiaries largely due to cost overruns in  Meenakhshi project and losses in Chinese subsidiaries. Expect these losses to contract in Q4

Read This:  Accumulate Thermax; target of Rs 648: PLilladher


 

READ MORE ON  thermax Q4, MS Unnikrishnan
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