Buy Ador Welding; target of Rs 310: ICICI Direct

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

live

• bselive
• nselive

Volume

Todays L/H

More

×

ICICI Direct's research report on Ador Welding

Ador Welding (AWL) reported consolidated revenues at Rs 139.9 crore, down 6.9% YoY, impacted by disrupted business activities across sectors. Revenue for FY20 was at Rs 526.5 crore, up 2.6% YoY. EBITDA was at Rs 7.6 crore, down 23.2% YoY impacted by higher other operating expenses owing to one-time provisions. EBITDA margins fell 160 bps YoY to 7.6%. However, gross margins for Q4FY20, FY20 improved 280 bps, 100 bps to ~29%, 30.4%, respectively. EBITDA margin for FY20 was at 8.2% with a marginal decline of 40 bps YoY. PAT was at Rs 6.9 crore, down 8.8% YoY, supported by lower effective tax rate for the quarter. For FY20, PAT was at Rs 28.7 crore, up 17.1% YoY, aided by new tax regime benefit. AWL lost ~Rs 30-40 crore revenue in Q4FY20 due to Covid-19 lockdowns.

Outlook

We value AWL on 15x FY22E EPS and arrive at a revised target price of Rs 310. We maintain our BUY rating. Key risks: Delay in PEB execution, working capital stress.

For all recommendations report, click here

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.

Read More