Institutional Equities - Online Share Trading
Institutional Equities - Online Share Trading
Institutional Equities - Online Share Trading
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<strong>Institutional</strong> <strong>Equities</strong><br />
Exhibit 6: Segment-wise order book trend<br />
Exhibit 7: Revenue vs order book of transportation segment<br />
(%)<br />
80<br />
70<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
57<br />
30<br />
69<br />
61<br />
27<br />
70<br />
18<br />
18<br />
10 12<br />
10<br />
9<br />
3 1 2 3<br />
46<br />
15<br />
6<br />
33<br />
56<br />
22<br />
11 11<br />
60<br />
69<br />
45<br />
38<br />
31<br />
29<br />
22 22<br />
22<br />
18<br />
9 9<br />
11<br />
5 5 6<br />
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11<br />
Water & Enviornment Buildings & Ind Structures Power Transportation<br />
Source: Company, Nirmal Bang <strong>Institutional</strong> <strong>Equities</strong> Research<br />
(%)<br />
35<br />
33<br />
31<br />
30<br />
27<br />
29<br />
25<br />
22<br />
20 18<br />
15<br />
10<br />
9<br />
9<br />
5<br />
5<br />
0<br />
FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11<br />
Transportation (% of OB)<br />
Revenue (%YoY) (RHS)<br />
Source: Company, Nirmal Bang <strong>Institutional</strong> <strong>Equities</strong> Research<br />
(%)<br />
80<br />
70<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
Historically, revenue growth has higher correlation with book-to-bill ratio<br />
During FY04, the BTB ratio fell from 3.4x in FY03 to 2.1x in FY04, which resulted in a sharp decline in revenue<br />
growth from 74% in FY04 to 37% in FY05. The BTB ratio was in the range of 3.5x-3.8x during FY05-08 and<br />
revenue growth was in a rising mode until FY08. The BTB ratio fell to 2.8x and revenue growth declined from<br />
59% in FY08 to 33% in FY09. Hence, we believe that historically the BTB ratio has shown a higher correlation<br />
with revenue growth. However, during FY10-11, the BTB ratio increased in the range of 3.8x-4.4x, but revenue<br />
growth did not pick up. Hence, we believe the project execution will pick up during 2HFY12-13 and revenue<br />
growth will also gain momentum.<br />
Exhibit 8: Order book to bill vs revenue growth<br />
(x)<br />
4.5<br />
4.0<br />
3.5<br />
3.0<br />
2.5<br />
2.0<br />
4.4<br />
4.0 4.0<br />
3.7<br />
3.8<br />
3.8<br />
3.4<br />
3.5<br />
3.6<br />
2.8<br />
2.1<br />
FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12E FY13E<br />
Order book to bill Revenue growth (%)<br />
(%)<br />
80<br />
70<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
Source: Company, Nirmal Bang <strong>Institutional</strong> <strong>Equities</strong> Research<br />
Exhibit 9: Order book growth, revenue growth trend<br />
Exhibit 10: Revenue growth vs order inflow growth<br />
(%)<br />
160<br />
140<br />
120<br />
100<br />
80<br />
60<br />
40<br />
20<br />
-<br />
(20) FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12E FY13E<br />
Revenue growth (%) Orderbook growth (%)<br />
Source: Company, Nirmal Bang <strong>Institutional</strong> <strong>Equities</strong> Research<br />
(%)<br />
290<br />
240<br />
190<br />
140<br />
90<br />
40<br />
(10)<br />
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12E FY13E<br />
(60)<br />
Revenue growth (%) Order inflow growth (%)<br />
Source: Company, Nirmal Bang <strong>Institutional</strong> <strong>Equities</strong> Research<br />
82 IVRCL
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