NESCO’s September quarter numbers beat the consensus estimates by a significant margin for the key performance parameters. Revenue increased by 21.2% yoy to Rs100cr vs. Rs82.6cr in Q2FY18, beating the estimates by 28%. EBITDA for the current quarter grew by 12.1% yoy to Rs66cr as compared to Rs58.9cr for the same period last year, beating the estimates by 11.7%. However, EBITDA margin declined from 71.4% in Q2FY18 to 66% in Q2FY19. Profit after taxes was almost flat at Rs49.3cr in Q2FY19 vs. Rs48.4cr in Q2FY18, beating the estimates by 14.7%.
Bottom-line was muted despite top-line growth, primarily impacted by higher material costs coupled with sharp rise in employee expenses (up 58.9% yoy to Rs5.3cr) and other expenses (up 21.4% yoy to Rs20.9cr).
Other income for the current quarter nearly halved to Rs5.1cr vs. Rs10cr for the same quarter last year.
Revenues from NESCO IT Park fell by 6% yoy to Rs35.2cr in Q2FY19. EBIT too declined by 12.2% yoy to Rs30.4cr for the quarter. EBIT margin declined from 92.2% in Q2FY18 to 86.2% in Q2FY19. The segment contributed 35.2% to the top-line of the company.
Bombay Exhibition Centre, which contributed 45.9% to the total revenues, saw a strong growth of 20.7% yoy to Rs45.9cr for the September quarter. Profit before interest and taxes for the segment increased by 11.7% yoy to Rs36.2cr, while margin declined 636bps yoy to 79% for the quarter.
Sales from Indabrator saw a strong growth of 45.6% yoy to Rs10.3cr, while EBIT dropped 40.5% yoy to Rs0.13cr. EBIT margin declined from 3% in Q2FY18 to 1.2% in Q2FY19. The segment contributed 10.3% to the top-line during the quarter.
Sales from ‘Food’ segment stood at Rs8.7cr, while EBIT came at Rs1.6cr for the quarter under review. Segment’s EBIT margin was 18.1% and it formed 8.6% of the top-line.
NESCO Ltd is currently trading at Rs. 457, down by 0.25 points or 0.05% from its previous closing of Rs. 457.25 on the BSE.
The scrip opened at Rs. 457.30 and has touched a high and low of Rs. 464.90 and Rs. 457 respectively. So far 49,342 (NSE+BSE) shares were traded on the counter. The stock is currently trading above its 200 DMA.
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