MOSL: GE T&D INDIA (Neutral)-A quarter of operational outperformance with improved revenue mix
GE T&D India: A quarter of operational outperformance with improved revenue mix
(GETD IN, Mkt Cap USD1.1b, CMP INR290, TP INR330, 14% Upside, Neutral)
- Performance driven by better revenue mix and project closures: Sales declined 4% YoY on account of completion of the HVDC orders that it had bagged earlier. HVDC sales stood at INR0.9b, down 64% YoY from INR2.4b in 1QFY18. Non HVDC revenue grew 11% YoY. EBITDA grew 37% YoY to INR1.4b (ahead of our estimate of INR650m), with the margin expanding 370bp YoY to 12.4%. PAT of INR820m (+33% YoY) was ahead of our estimate of INR440m, led by provision write-back of INR110m during the quarter.
- EBIDTA margin improves 270bp YoY: EBIDTA stood at INR1.4 v/s INR1.1b in 1QFY18, with the margin improving 370bp YoY to 12.4%, supported by a better revenue mix and project closures (contributed INR250m to profit). Adjusting for project closure contribution of INR250m, the operating margin stood at 10.3% (+160bp YoY).
- Order inflow declines sharply: Order intake fell 61% YoY to INR6.1b in 1QFY19, given weak order finalization from PGCIL. Orders from PGCIL stood at INR600m and SEB contributed INR2.7b. Order backlog stands at INR66b, providing revenue visibility for the next 18 months. GETD expects ordering from state SEBs to remain strong and also looking at neighboring countries for the export business.
Alstom T&D India is engaged in the manufacture and distribution of electrical components including switchgear, transformers, reactors and control panels. Co.'s products include combination fuse switch boards, distribution fuse boards, overhead busbars, plug in boxes, fuses, switchgear components, miniature circuit breakers,motors, pumps, fans, meters and vacuum interrupters.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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