Astra Microwave: Visibility improves, but valuation tempers excitement
The benefits from Astra Microwave's efforts to cut employee costs and other fixed expenditure are clearly visible in its operating performance
July 13, 2021 / 04:28 PM IST
PRO Only Highlights
Quarterly performance largely backed by improved realisations
Medium-term triggers China plus and protectionist measures for tyre industry
Valuations not inexpensive; but improved medium-term outlook
Downstream defence ancillary companies are now gradually benefiting as larger players start getting new orders. One important player in this segment, Astra Microwave (CMP: Rs 167.9; Market Cap: Rs 1,454 crore) has seen good revival in its business with order inflows and execution seeing good traction in the recent past.
With strong orders in hand, revenue visibility has improved. Higher execution has resulted in higher earnings, better utilisation of spare capacities and thus improved cash-conversion cycle and balance sheet.