HDFC Securities' research report onPSP Projects
PSP’s 4QFY18 revenue was in-line with our estimates of Rs 2.6bn. Higher than expected EBITDA margins led to EBIDTA/PAT beat of 25.5/23.3%. Balance sheet continues to remain healthy with net cash/equity of 0.7x. Bid pipeline of Rs 20bn is strong with PSP targeting close to Rs 10bn of order inflows in FY19E. PSP has bid for Rs 10bn of commercial project in Southern India and other projects with cumulative value of Rs 10bn projects in Gujarat.
OutlookWe expect an increase in investments in office space and retail to continue to drive institutional construction along with FDI and manufacturing activity aiding industrial construction. We maintain BUY on PSP with TP of Rs 639/sh (18x Mar-20E EPS).
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