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Last Updated : Jul 14, 2012 05:54 PM IST | Source: Moneycontrol.com

Capital goods cos` sales to grow by 3.5% in Q1: P Lilladher

Prabhudas Lilladher has come with its June quarterly earning estimates for capital goods sector. According to the research firm, capital goods companies are expected to grow by 3.5% YoY in Q1FY13.

 
 
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Prabhudas Lilladher has come with its June quarterly earning estimates for capital goods sector. According to the research firm, capital goods companies are expected to grow by 3.5% YoY in Q1FY13.

Prabhudas Lilladher Q1FY13 Result Preview for Capital Goods sector:

Over the last three months, the Capital goods index has outperformed the broader markets by ~5%. We expect sales for our coverage universe to grow by 3.5% YoY in Q1FY13. EBITDA margins are expected to be at 11.1% and PAT is expected to degrow by 4.9% (excluding Suzlon) for the quarter.

CMIE data on new project announcement continues to show a declining trend. Increase in projects shelved also point to a weak outlook in the near term. New investment announcements fell to Rs2.6trn in March 2012 quarter (down 26% YoY) v/s Rs2.2trn in December 2011 quarter (down 30% YoY) v/s Rs2.5trn in September 2011 quarter (down 32% YoY) v/s Rs3.1trn in June 2011 quarter (down 44% YoY). The number of projects shelved also continues to be high at Rs1.5trn in March 2012 (up 237% YoY) v/s Rs1trn in December 2011 quarter (up 267% YoY) v/s 1.9trn in September 2011 quarter from Rs479bn in June 2011 quarter. Average value of projects shelved in the last three quarters stands at ~1.5trn, a rise of 2-3x over the previous seven quarters which is a worrying sign. This is among the highest in the last 15 years.

The imposition of import duty would have been a definite positive for domestic manufacturers like BHEL, L&T, BGR, Thermax etc. as it would have improved competitiveness in terms of price. We believe it is too late in the day as 93GW of capacity is already under construction. The bigger issue today is order finalization from the private players which is standstill due to issues like land, coal and SEB finances.

 

                                                  (Rs in million)

 

Q1FY13E

Q1FY12

YoY gr. (%)

BHEL
Sales71,62071,2570.5
PAT7,3228,156-10.2
Power Grid Corporation
Sales32,53122,02547.7
PAT9,8157,05339.2
ABB
Sales17,77716,9305
PAT4033874
Cummins India
Sales11,46010,4539.6
PAT1,4731,25717.2
Crompton Greaves
Sales26,76924,3779.8
PAT1,06077736.4
Thermax
Sales8,85010,444-15.3
PAT728799-8.9
Voltas
Sales14,27413,4586.1
PAT642734-12.5
Suzlon Energy
Sales49,93843,80014
PAT-1,998600-432.9
BGR Energy Systems
Sales7,5917,3123.8
PAT432503-14
KEC International
Sales11,55010,22513
PAT319331-3.6
Kalpataru Power
Sales6,1525,8275.6
PAT275336-18.3
Jyoti Structures
Sales6,8106,3776.8
PAT228262-12.8



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First Published on Jul 12, 2012 04:05 pm
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