Bharat Bijlee Q2FY17: Firstcall are overweight for medium to long term investment

Firstcall India Equity | May 12, 2016, midnight


SYNOPSIS:

  • Bharat Bijlee Limited is one of the leaders in the electrical engineering industry in India.

  • The company achieved a turnover of Rs. 1436.10 million for the 2nd quarter of the FY 2016-17 as against Rs. 1335.70 million in the corresponding quarter of the previous year, an increase of 7.52%.

  • During the quarter, net profit increased by 1158.21% to Rs. 84.30 million from Rs. 6.70 million in the corresponding quarter ending of previous year.

  • During the quarter, EBIDTA stood at Rs. 143.50 million as against Rs. 77.80 million in the corresponding period of the previous year, up by 84.45%.

  • During the H1 FY17 the company turnover increased to Rs. 2738.80 million from Rs. 2653.60 million in the corresponding period of previous year, up by 3.21%.

  • EPS of the company stood at Rs. 14.92 in Q2 FY17 against Rs. 1.19 in the corresponding quarter of the previous year.

  • In the H1 FY17 PAT of the company increased to Rs. 50.60 million against net loss of Rs. 41.60 million in the previous year.

  • Net Sales of the company are expected to grow at a CAGR of 10% over 2015 to 2018E.

 

OUTLOOK AND CONCLUSION:

  • At the current market price of Rs. 777.00, the stock P/E ratio is at 15.55 x FY17E and 12.90 x FY18E respectively.

  • Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 49.98 and Rs. 60.25 respectively.

  • Net Sales of the company are expected to grow at a CAGR of 10% over 2015 to 2018E.

  • On the basis of EV/EBITDA, the stock trades at 10.34 X for FY17E and 9.17 X for FY18E.

  • Price to Book Value of the stock is expected to be at 1.46 x and 1.31 x for FY17E and FY18E respectively.

  • Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.

 

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