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In the current quarter, the company has picked large orders from refinery sector for the Bharat VI quality improvement programme, said MS Unnikrishnan, MD, Thermax.
Key issues to watch out for would be demand environment in domestic and overseas markets; order inflow; and sustainability of margin.
The expansion plans/investments in new areas to reduce dependence on traditional businesses continued. The company is seeing nascent signs of recovery. Should investors put the stock back on their radar?
The pre-goods and services tax (GST) slowdown impacted Thermax's performance in Q1 as expected as energy EBIT margins declined while profitability shrinks. In an interview to CNBC-TV18, MS Unnikrishnan, MD of Thermax spoke about the results and his outlook for the company.
Revenue may be hit due to weak order book position. Analysts expect gradual pick-up in the energy segment from Q1FY18 onwards.
Thermax expects 3-4 segments to open up in Q4 and Q1 of FY18 supporting medium and large projects, which had gone dry in this financial year.
Net Sales are expected to increase by 8.2 percent Q-o-Q (down 9.3 percent Y-o-Y) to Rs 941.9 crore, according to ICICI Securities.
Energy and environment engineering company Thermax is expected to report dismal performance for July-September quarter. Profit on standalone basis is likely to fall by 9.2 percent year-on-year to Rs 59 crore and revenue may slip 9.3 percent to Rs 959 crore in Q2, according to analysts polled by CNBC-TV18.
Thermax has started bidding for selective and specialised products and is close to winning a large order in the solar thermal space, says MS Unnikrishnan, MD of Thermax.
Sales are expected to decrease by 31.6 percent Q-o-Q (down 11.7 percent Y-o-Y) to Rs 884.2 crore, according to ICICI Securities.
Lower revenue may be on account of low order backlog. Order inflows during the quarter may remain muted. Analysts expect order book at Rs 3,509 crore and order inflow of Rs 1,159 crore for the quarter.
Orders inflows have been subdued and orders carried in the current year were substantially lower, says MS UnniKrishnan, MD of Thermax.
Operating profit may fall 15 percent to Rs 112 crore and margin may contract 136 basis points to 10.1 percent on yearly basis.
Thermax saw orders worth Rs 528 crore from the domestic markets in the second quarter of this fiscal year, while its international order book stood at just Rs 200 crore, says MS Unnikrishnan, MD of the company
Operating profit (earnings before interest, tax, depreciation and amortisation) is likely to decline marginally to Rs 121 crore from Rs 123 crore and margin may contract to 10.2 percent from 10.3 percent on yearly basis.
In an interview with CNBC-TV18, MS Unnikrishnan, Managing Director at Thermax said June quarter earnings benefited from cost saving and waste reduction strategies
Energy and environment engineering company's revenue is expected to increase 5.9 percent to Rs 889 crore from Rs 839 crore during the same period, according to the average of estimates of analysts polled by CNBC-TV18.
Thermax's fourth quarter profit is expected to increase 8.8 percent year-on-year to Rs 115 crore led by operational performance, according to a CNBC-TV18 poll. However, lower other income may limit the bottomline growth.
Thermax missed street expectations on Friday with the third quarter net profit rising 13 percent year-on-year to Rs 76.2 crore. The bottomline was impacted by lower other income and higher tax expenses.
Thermax's third quarter profit after tax is seen rising 23.7 percent year-on-year to Rs 82.4 crore, according to the average of estimate of analysts polled by CNBC-TV18.
Thermax reported over two-fold jump in its net profit at Rs 86 crore for the quarter ended September 30, 2014. The company had posted a net profit of Rs 30.16 crore in the corresponding quarter of the last financial year.
A lot of capital good stocks are in focus today and one such stock is Thermax. The company has reported a very weak set of numbers.
Total income is seen going up 4.6 percent to Rs 1,095 crore in the quarter ended December 2013 from Rs 1,047 crore in a year ago period.
The order carry forward at this point of time is approximately Rs 5,300 crore against Rs 4,900 crore, which is around 20 percent more than the previous year.
Profit after tax is expected to decline 15.8 percent year-on-year to Rs 76.7 crore and total income may fall 3.8 percent Y-o-Y to Rs 1,136 crore in the quarter gone by.