Blue Star's third quarter profit is seen rising three-fold year-on-year to Rs 8.5 crore, according to the average of estimates of analysts polled by CNBC-TV18. PAT could be higher than the EBITDA growth due to low base of Q3FY14 and recovery in margins in electro-mechanical projects (EMP) segment.
Total income of the airconditioning and commercial refrigeration company may increase 8.3 percent to Rs 591 crore during the October-December quarter against Rs 546 crore in same quarter last fiscal.
Its cooling products segment is likely to report revenue growth of 18-20 percent Y-o-Y, in-line with the industry average. Analysts say continuing theme in Blue Star is that of healthy growth in room AC volumes as the industry revived from downcycle and bottoming out of the central AC projects margins.
Operating profit (EBITDA) may spike 38.3 percent on yearly basis to Rs 20.6 crore and margin may expand 80 basis points to 3.5 percent in the quarter gone by.
Analysts expect modest improvement in EBITDA margin due to higher contribution from high margin cooling products segment. EMP margins may be sluggish due to execution of lower margin legacy projects.
Key factors to watch out for would be ability to sustain EBITDA margins, debt reduction and closure of low margin legacy orders.
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