Centrum is bullish on Ahluwalia Contracts (India) has recommended buy rating on the stock with a target price of Rs 418 in its research report dated August 23, 2018.
Centrum's research report on Ahluwalia Contracts (India)
Ahluwalia Contracts (India) Ltd (ACIL), for Q1FY19, reported muted numbers, mainly on the back of one-offs. Revenue declined by ~20% YoY to 404 crore, on the back of slow execution in few projects (impact of 35 crore – Delhi CPWD project – tree cutting issue, and NBCC Kolkata – design issue). EBITDA declined by 2% to 53 crore. Lower raw material cost (down 1,099bps to 43.5% of Q1FY19 sales) was partly offset by higher employee cost (up 258bps to 8.9%) and other expenses (up 603 bps to 34.6%) leading to EBITDA margin expansion of 238bps to 13%. Net profit declined by ~5% to 28 crore.
We thus change our rating to BUY, maintaining our target price of 418 (16x FY20E EPS).
For all recommendations report, click here
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