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Buy Triveni Turbine; target of Rs 240: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Triveni Turbine has recommended buy rating on the stock with a target price of Rs 240 in its research report dated August 03, 2022.

August 04, 2022 / 09:40 PM IST
 
 
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Prabhudas Lilladher's research report on Triveni Turbine


Triveni Turbine (TRIV) reported a robust performance, with healthy revenue (up 40.7% YoY), led by strong exports growth (up 59% YoY), while domestic revenue grew 32% YoY. Order inflows of Rs3.6bn (up 30.9% YoY) were driven by higher international product orders and a large aftermarket order in South African Development Community (SADC) region. Strong Enquiry pipeline from both domestic as well as exports market, likely aid medium term order inflow visibility. Near term outlook remains positive given 1) strong exports demand (as inquiry pipeline grows 22% YoY) 2) continued domestic demand from sectors such as distilleries, steel, cement, pharma, pulp, paper, food processing etc. 3) enhanced addressable market in energy-efficient API turbines for Oil & Gas industry and 30-100 MW turbines and 4) capacity expansion at Sompura plant to meet increasing demand for next couple of years. Management indicated with improving product mix, increasing exports contribution, PBT margins are expected to sustain at ~20% levels in medium term. We believe strong order book at Rs10.7bn, robust enquiry pipeline, incremental opportunity with foray into 30-100MW market & API Turbines and favorable product mix likely to aid margins and drive growth in medium term.



Outlook


Accordingly, we expect revenue/PAT CAGR of 27%/34% for FY22-24E. The stock is trading at PE of 37.2/28.1x FY23/24E. We maintain ‘Buy’ rating on stock with TP of Rs240 (same as earlier), valuing it at PE of 35x FY24E EPS.

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Triveni Turbine - 030822 - prabhu

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first published: Aug 4, 2022 09:40 pm
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