Angel Broking is bullish on ILandFS Transportation Networks and has recommended buy rating on the stock with a target of Rs 265 in its May 7, 2012 research report.
“For 4QFY2012, on a consolidated basis, IL&FS Transportation Networks (ITNL) posted a strong set of numbers, which were ahead of our estimates on all fronts. This robust performance was on account of higher-than-expected revenue growth, led by E&C revenue. However, the fall in EBITDAM and high interest cost prevented top-line growth to flow to the bottom-line level. We are revising our estimates to factor in 4QFY2012 performance. We maintain our Buy recommendation on the stock.”
“For 4QFY2012, ITNL’s revenue for the quarter came in at Rs1,989cr (Rs1,656cr), registering 20.1% yoy/56.8% qoq growth, significantly higher than our estimate of Rs1,507cr. This was mainly on account of increased contribution from the E&C segment. EBITDA margin for the quarter stood at 23.0% vs. 24.8% in 4QFY2011, down 180bp yoy and 230bp qoq, respectively, against our estimate of 24.8%. ITNL’s interest cost during the quarter grew by 28.9% yoy/24.5% qoq to Rs231cr, ahead of our expectation of Rs200cr. On the earnings front, ITNL reported 11.4% yoy growth to Rs177cr, higher than our estimate of Rs111cr on the back of strong revenue growth.”
“During the quarter, ITNL bagged road BOT projects worth Rs4,948cr, taking its order book to Rs12,057cr (OB of 4.3x FY2012 standalone revenue), thus putting the concern on order inflow to rest. Hence, going ahead, the company would focus on the execution of these projects. We have valued ITNL on an SOTP basis by assigning 5.0x EV/EBITDA to its standalone business and have valued its investments on DCF/Mcap/BV basis on FY2014E to arrive at a target price of Rs265/share. Hence, we maintain our Buy view on the stock,” says Angel Broking research report. Public holding more than 90% in Indian cos Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. To read the full report click on the attachment
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