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Institutional Equities
Financial performance
Exhibit 27: Revenue trend segment-wise
(%)
120
100
80
60
40
20
0
Revenue to witness a CAGR of 37% during FY11-13
Out of Rs117bn order book of the EPC segment, Rs46.8bn worth of projects are in active stage of
construction and would be completed by FY13, while Rs36bn worth Ahmedabad-Vadodara project would
begin construction from 1QFY13, which has improved long-term revenue visibility. Based on this, we expect
the EPC segment’s revenue to show a CAGR of 41% between FY11-13. BOT toll revenue is expected to
witness a CAGR of 19%, primarily driven by revision in toll rate and completion of projects. Subsequently, we
expect net sales to show a CAGR of 37% to Rs31.9bn and Rs45.8bn in FY12 and FY13, respectively.
44 39 33 33
56 61 67 67
FY09 FY10 FY11 FY12 FY13
Construction
BOT Toll Revenue
Source: Company, Nirmal Bang Institutional Equities Research
EBITDA to register CAGR of 26%
26
74
Exhibit 28: Revenue growth trend
(Rsmn) (%)
50,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
-
FY09 FY10 FY11 FY12E FY13E
Net sales
% YoY
Source: Bloomberg, Nirmal Bang Institutional Equities Research
We expect EBITDA to grow at a CAGR of 26% to Rs 13.5bn in FY12 and 17.2bn in FY13 primarily driven by
robust growth in revenue. However, EBITDA margin would come down by 700bps to 38% in FY13 from 45%
in FY11 due to increase in the contribution of low margin EPC segment’s revenue to total revenue, from 67%
in FY11 to 74% in FY13.
Exhibit 29: Consolidated EBITDA margin trend
Exhibit 30: EBITDA and EBITDA growth
80
70
60
50
40
30
20
10
0
(%)
50
48
46
44
42
40
38
36
34
32
FY09 FY10 FY11 FY12E FY13E
Source: Company, Nirmal Bang Institutional Equities Research
(Rsmn)
(%)
20,000
48
18,000
46
16,000
44
14,000
42
12,000
40
10,000
38
8,000
6,000
36
4,000
34
2,000
32
-
30
FY09 FY10 FY11 FY12E FY13E
EBITDA
Growth(YoY)
Source: Bloomberg, Nirmal Bang Institutional Equities Research
Net profit to register CAGR of 11%
Five BOT projects worth Rs82bn would be operational over FY12 to FY13, which would increase the
depreciation and interest costs. Subsequently net profit growth would be subdued and grow at a CAGR of
11% between FY11 to FY13. The decline in profitability and increase in debt post commissioning of BOT
assets would depress the return ratios over the same period. We expect the RoE to come down by 160bps to
17.3% and RoCE by 90bps to 8.9% in FY13 over FY11.
37 IRB