February 15, 2017 / 16:40 IST
VATW delivered strong EBIDTA growth of 79% YoY (29% higher than expectations), led by better profitability in certain large jobs like Petronas, APGENCO, AMAS, Bahrain with 300bps plus expansion in gross margin YoY. While final provisioning for the Oman JV project was expected, the quantum taken in P/L came as a negative surprise, leading to net loss, adjusted for which core PAT stood higher at INR398mn (+90% YoY).
Outlook
Maintain ‘BUY‘ with TP of INR746 (FY19E 19x P/E), given reasonable earnings CAGR (FY16-19E) of 30%, and 20%+ RoCE by FY19E in light of attractive 12x PE and 6/12M underperformance by 15/25% versus benchmark Sensex returns.
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