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See EBITDA margins at 13% in FY11: Sunil Hi-tech
In an interview with CNBC-TV18, Sunil Gutte, Whole-time Director, Sunil Hi-Tech Engineers Ltd spoke about the order book position, its emergence as balance of plant player,90 and the business plans of the company.
Q: You said that largely you will be able to bit for higher volume business, so in FY11 what kind of revenue growth you see?
A: We are estimating anywhere between 25-30% growth based on our current order book position which is pending to be executed in 24-30 months and with this BOP qualification the larger order bidding capacity has gone up. Our single order size what we are eligible now goes beyond Rs 500 crore to Rs 1000 crore. So any contract, which is EPC of even Rs 600 crore, the balance of plant portion comes roughly around Rs 1,200 crore. So initially we were not able to bid for those plants but now we are in a position to bid it and even if the hit ratio what we compare even if it is 10%, the single order could be in the range of Rs 1000 crore now.
Q: So you think you would do Rs 1000 crore next year?
A: Yes we are optimistic.
Q: What about margins, you said your margins would become wobbly. So what do you expect in terms of an EPS in FY11?
A: Right now the EBITDA margins are in the range of 11.5-12%. We are trying to maintain the margins and probably we are going to increase it. With the orders we have bidded, the Rs 2062 crore order executed in next 24 months we feel the margins should move up by 1% on the EBITDA levels and net margins which are at 4% net should go to 4.5% to 4.7%.
