Premier Explosives Q2FY17: Fundamental Analysis - Firstcall India Equity

Firstcall India Equity | May 9, 2016, midnight


SYNOPSIS

  • Premier Explosives Limited (PEL) is an India-based Company is engaged in the manufacture and sale of industrial explosives, defense products.
  • During the quarter, the company achieved a turnover of Rs. 549.24 mn as against Rs. 404.42 mn in the Q2 FY16, up by 35.81%.
  • During Q2 FY17, Net profit jumps to Rs. 23.96 mn from Rs. 18.90 mn in the corresponding quarter ending of previous year, an increase of 26.79%.
  • During the quarter, EBIDTA is Rs. 53.47 mn as against Rs. 38.42 mn in the corresponding period of the previous year, up by 39.17%.
  • During Q2 FY17, PBT increased by 60.41% to Rs. 36.09 mn from Rs. 22.50 mn in Q2 FY16.
  • EPS of the company stood at Rs. 2.71 during the quarter, registering 26.80% increased over previous year period.
  • Total Order book as on 3oth September 2016 stands at Rs 2,730 mn; Explosives - Rs 1,610 mn; Defence Rs 870 mn; Services - Rs 250 mn.
  • On 05 Oct 2016, Premier Explosives Ltd has bagged order worth of Rs. 277.9 mn for supply of Booster grains from Bharat Dynamics Limited.
  • Revenues for H1 FY17 stood at Rs. 1022.22 mn as compared to Rs. 780.92 mn in H1 FY16, up by 30.90%.
  • During the half year ended 2016-17, Net Profit stood at Rs. 41.56 mn as compared to Rs. 4.23 mn in the previous year same period.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 15% and 6% over 2015 to 2018E respectively.


OUTLOOK AND CONCLUSION

  • At the current market price of Rs.326.80, the stock P/E ratio is at 30.57 x FY17E and 25.32 x FY18E respectively.
  • Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 10.69 and Rs. 12.91 respectively.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 15% and 6% over 2015 to 2018E respectively.
  • On the basis of EV/EBITDA, the stock trades at 14.02 X for FY17E and 12.03 X for FY18E.
  • Price to Book Value of the stock is expected to be at 3.86 x and 3.35 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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