Nov 08, 2012, 02.08 PM | Source: Moneycontrol.com
KRChoksey is bullish on ILandFS Transportation Networks and has recommended buy rating on the stock with a target of Rs 222 in its November 7, 2012 research report.
, KRChoksey |
“ILFT reported Q2FY13 consol PAT of Rs 116 crore (-0.2%, YoY), mostly in line with estimates (Rs 113 crore), primarily led by high fee income (Rs 208 crore) from newly won projects. Consol revenue grew to Rs 1,370 crore (+9.2%, YoY), primarily led by construction & fee income Rs 923 crore (+4%, YoY), Elsamex Rs 196 crore (+6.9%, YoY) and Toll income Rs 212 crore (+140%, YoY). EBITDA however grew to Rs 453 crore (+29.9%, YoY) and margins (33.0%) have improved by 462 bps due to high portion of Fee income and Toll revenue. However, standalone construction margins are 9.4% (-100 bps, YoY). Interest costs increased to Rs 280.4 crore (+72%, YoY) and total debt reached to Rs 123 bn (cosol D/E- 3.9x) led by withdrawn of more debt for ongoing projects. ILFT needs Rs 10 bn incremental equity for existing projects and already have invested Rs 28 bn.”
“ILFT consists of order backlog of Rs 108.8 bn shows the revenue visibility for next two years. Management is confident to achieve the order inflow matching with previous year as NHAI’s awarding activities will catch pace in H2FY13E. The company received the order inflow of Rs 8 bn led by one new project in Q2FY13. Substantial revenue is contributed by Chenani-Nashri Tunnel in J&K state. ILFT’s substantial profitability is added by higher portion of fee income, we believe it is big challenge for ILFT to maintain Fee Income in long term. However, considering the opportunity and positioning of ILFT in the road sector, we updated our TP to Rs 222 (from Rs 193) and recommend “Buy” on ITNL,” says KRChoksey research report.
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