Bgr+Energy+q4fy11
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Transcript of Bgr+Energy+q4fy11
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QuarterlyUpdate BGREnergySystemsLtd.Recommendation BUY
Results in Line with expectation, New order inflow wou
bethekeytriggergoingforward.
KeyHighlights. DuringthequarterBGRenergyreported 12%(YoY)degrow
insales,butwasinlinewithourestimates.
EBIDTAmarginincreasedby90bpsfrom10.6%to11.5%YoYaccountofdeclineinotherexpenditure&employeecost
CurrentorderbookstandsatRs.7971crswithpowersegmcontributing around 92%. Total order inflow for FY11 w
aroundRs.2941crs. OrderInflowforcompanyhasbeenmu
for past 68 months on account of several issues like c
linkage,
environmental
clearance
etc.
Company
has
bided
the order worth of Rs. 20,000 crs (40GW) and expects to
goodamountofsharebyQ2FY12.
According to management, order from Rajasthan is gettdelayedduetocoal linkage.Managementexpectsthisprob
tobesolvedbyJune2011andexpecttogetorderbyQ2FY12
Guidance:Managementhasguided15%growth inrevenueEBIDTAmargintohoveraround1112%. ItexpectsPATma
around6.5%
TheLowerGrowthinnextyearisonaccountofdelayinginfrorder inflow. Once the new order starts coming in, BGR
againcomebackonhighgrowthpath.
BGRreportPATofRs.98.3Crsagainst108Crs,declineof9%YoYbasisonaccountofhigherdepreciationandInterestcost
CompanyreportedtheEPSofRs.13.6against15.05inQ4FY10Webelieve thatgoingforward;fresh triggerfor the companywillneworderinflow. Asstatedabove,companyhasbidedorderworthRs20,000crs&weexpectcompanytogetgoodamountofsharefrit. AtCMP,stockistrading10xFY12EearningswithEPSofRs.47.4share.WemaintainourBUYratingonthestock withthetargetprice662
CMP(27/05/2011) Rs.475
Target
662
Sector PowerEquipment
StockDetails
BSECode
NSECode
MarketCap(Rs.cr)
FreeFloat(%)
52 wkHI/Lo
Avg.volumeBSE(Monthly)
Dividend(FY11)
Shareso/s
(Crs)
532930
BGR
3351
37.85
871/402
77583
100%
7.20
RelativePerformance 1Mth 3Mth 1Yr
BGR 18.3% 3% 20%
Sensex 7.7% 2% 10%
ShareholdingPatternasof31/03/2011
IndianPromoterHolding 81.13%
FII,banks&Institutions 10.32%
CorporateBodies 1.96%
Public&others 6.58%
Anand Vyas,ResearchAnalyst(02239268173)
Year NetSales Growth% EBIDTA
EBIDTAM
(%) PAT
PATM
(%) EPS(Rs.) P/E(x) P/BV
FY2009 1,922.1 26.4% 204.0 10.6% 111.2 5.8% 15.4 30.8 6
FY2010 3,073.8 59.9% 348.9 11.3% 201.8 6.6% 28.0 16.9 4
FY2011 4,760.8 54.9% 550.3 11.6% 324.0 6.8% 45.0 10.6 3
FY2012E 5,412.7 13.7% 616.5 11.4% 341.4 6.3% 47.4 10.0 2
40
90
140
190
May1
0
Jun1
0
Jul1
0
Aug1
0
Sep1
0
Oct1
0
Nov1
0
Dec1
0
Jan1
1
Feb
1
1
Mar1
1
Apr1
1
May1
1
BGR Sensex
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QuarterlyUpdate BGREnergySystemsLtd.QuarterlyResults
Q4FY11 Q4FY10 YoY% Q3FY11 QoQ %Netsales 1,457.28 1,657.08 12.1% 1,251.00 16.5%
OtherOperatingRevenue 4.35 2.69 5.80
TotalRevenue 1,461.63 1,659.77 11.9% 1,256.80 16.3%TotalExp. 1,294.25 1,484.56 12.8% 1,109.68 16.6% (inc)/DecinstockinTrade 1.63 0.04 (3.17)
ConsumptionofRawMaterials 1,237.11 1,382.06 10.5% 1,013.26 22.1%
TotalCOGS 1,238.74 1,382.10 10.4% 1,010.09 22.6%
EmployeeCost 35.36 47.51 25.6% 41.47 14.7%
OtherExp. 20.15 54.95 63.3% 58.12 65.3%
EBIDTA 167.38 175.21 4.5% 147.12 13.8%EBIDTAMargin(%) 11.5% 10.6% 11.7%
OtherIncome 1.74 3.93 55.7% 1.68 3.6%
Depreciation 7.03 3.07 129.0% 3.42 105.6%
EBIT 162.09 176.07 7.9% 145.38 11.5%
Interestcost 18.28 11.83 54.6% 16.76 9.1%
PBT 143.81 164.24 12.4% 128.62 11.8%
Tax 45.44 55.91 18.7% 41.13 10.5%
PAT 98.37 108.33 9.2% 87.49 12.4%Margin(%) 6.7% 6.5% 7.0%
Equity 72.00 72.00 72.00
EPS 13.66 15.05 12.15(Sources: Companydata,NirmalBangResearch)
Sources: Companydata,NirmalBangResearch)
1061310215
9523
10881
12197
1106910230
9397
83649173
7971
Q2FY09 Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10 Q4FY10 Q1FY11 Q2FY11 Q3FY11 Q4FY11
Orderbacklog(Rs. Crs)
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QuarterlyUpdate BGREnergySystemsLtd.MajorProjectExecutionStatus
Projects Size Type %CompletedJalawar(Raj) 2x660MW EPC 70%
Mettur(Tamilnadu) 1x660MW EPC 80%
Krishnapatnam(A.P) 2x660MW BOP 0%
Marwa(Chattisgarh) 2x500MW BOP 20%
Kothgudam(A.P) 1x500MW BOP 90%
Khaperkheda(Maharashttra) 1x500MW BOP Completed
Kakatiya(A.P) 1x500MW BOP Completed
Chandrapur(Maharashtra) 2x 500MW BOP 40%
(Sources: Companydata,NirmalBangResearch)
Otherkeyhighlights:
TheHitachiJV isonthetrackandcompanyhasacquired landfortheconsiderationofRs..150crs.Landforancillaryactivitiesisyettoacquire. Companyexpectsfinancialclosureforthesame
innext4months.
Management Indicated that macro issues like Coal linkage, environmental clearance, financialclosureetc.,haveaffectedtheorderingactivityinpowersector.
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QuarterlyUpdate BGREnergySystemsLtd.
NOTE
Disclaimer
This Document has been prepared by Nirmal Bang Research (Nirmal Bang Securities PVT LTD).Theinformation,analysisandestimates containedhereinarebasedonNirmalBangResearchassessmentandhavebeenobtainedfromsourcesbelievedtobereliable.Thisdocumentismeantfortheuseoftheintendedrecipientonly.Thisdocument,atbest,representsNirmalBangResearchopinionand ismeantforgeneralinformationonly.NirmalBangResearch,itsdirectors,officersoremployeesshallnotinanywayberesponsibleforthecontentsstatedherein.NirmalBangResearchexpresslydisclaimsanyandallliabilitiesthatmayarisefrominformation,errorsoromissionsinthisconnection.Thisdocumentisnottobeconsideredasanoffertosellorasolicitationtobuyanysecurities.NirmalBangResearch,itsaffiliatesandtheiremployeesmayfromtimetotimeholdpositions insecuritiesreferredtoherein.NirmalBangResearch or its affiliatesmayfrom time to time solicitfrom orperform investment banking or otherservicesforanycompanymentionedinthisdocument.
