Motilal Oswal - Ashoka Buildcon (ASHOKA) MOSL: ASHOKA BUILDCON (Buy)-Beat on all fronts supported by robust execution

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Motilal Oswal

MOSL: ASHOKA BUILDCON (Buy)-Beat on all fronts supported by robust execution

Ashoka Buildcon: Beat on all fronts supported by robust execution

(ASBL IN, Mkt Cap USD0.5b, CMP INR124, TP INR175, 42% Upside, Buy)

Better-than-expected execution drives operational beat: Standalone revenue grew 102% YoY to INR7.6b in 2QFY19, ahead of our estimate of INR4.3b. Sales were supported by better-than-estimated execution of projects in hand. Construction revenue grow 111% YoY supported by strong growth in the power T&D segment (+152% YoY to INR3.3b). EBIDTA grew 127% YoY to INR1.0b, ahead of our estimate of INR518m, with margin improvement of 160bp to 13.6% from 12.0% in the year-ago period. Adj. PAT of INR621m, ahead of our estimate of INR362m, grew by 124% YoY.
Order backlog provides robust revenue visibility: ASBL’s order backlog as of Sept’18 stood at a healthy INR98b (including HAM EPC of INR52b). This provides revenue visibility of 4.0x its FY18 EPC revenue. ASBL expects order inflow of INR40-50b from road, power T&D and railways sector in 2HFY19. Incrementally ASBL is L1 in orders worth INR7.9b for 2 packages of RVNL where the scope involves construction of electrical, signaling and telecommunications works for railways..

06/11/2018 8 EN

Underlying

Ashoka Buildcon

Ashoka Buildcon Ltd.. Ashoka Buildcon Limited is an India-based infrastructure development company. The Company is engaged in construction and maintenance of roads, and supporting services to land support-operation of toll roads and others. The Company operates through three segments: Construction and Contract related activities; BOT Projects, and Sales of Goods. Its Construction and Contract related activities segment consists of execution of engineering and construction projects to provide solutions in civil and electrical engineering (on turnkey basis or otherwise) to core/infrastructure sectors. The Company's BOT Activity relates to execution of projects on long-term basis comprising developing, operating and maintaining the infrastructure facility. The Sales of Goods segment includes the activity of selling of ready mix concrete (RMC), plain cement concrete (PCC) poles, software and bitumen. The Company has projects under construction in the States of Tamil Nadu, Karnataka, Odisha and West Bengal.

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INE442H01029 National Stock Exchange of India India

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Motilal Oswal

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MOSL: ASHOKA BUILDCON (Buy)-Beat on all fronts supported by robust execution

With a more favourable environment, ASHOKA BUILDCON improves to Slightly Positive

Monthly LMI Update Independent Investment Research

Ashoka Buildcon's Q3FY20 results (Outperformer) - Slow execution impacts profitability

MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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