Security and Intelligence Services (India) Ltd (SIS) reported strong growth on revenue and net profit fronts for Q3FY18. Revenue grew by 35.2% yoy to Rs1,538cr. EBITDA stood at Rs84cr, up 40.7% yoy. EBIDTA margin rose by 22bps yoy to 5.5%. Adj. Net Profit stood at Rs47cr up 113.3% yoy.
Revenue growth was aided by 40% yoy growth in Security India. This was due to strong volume (Head Count) growth of 19% yoy.
Secrurity India EBITDA grew 47.9% yoy, supported by growth in revenues and 37bps yoy expansion in margins, driven by benefits of operating leverage.
Security Australia recorded 33.6% yoy revenue growth. Organic growth was 13.4% yoy. The rest was attributable to inorganic contribution from consolidation of SXP from July 2017 onwards. The Management expects the segment revenue to grow 7-10% yoy going forward.
Security Australia EBITDA margin dipped by 19 bps yoy despite consolidation of higher margin (~7%) SXP business, mainly due to lower-margin order wins during the quarter.
Facility Management posted 28.9% yoy growth, aided by 14% yoy volume growth and increase in revenue per billing employee.
Facility Management EBITDA margin expanded by 139bps yoy and 90 bps qoq, likely due to benefits of operating leverage.
Each of the above businesses have strong revenue pipeline for Q4FY18 and Q1FY19.
Cash Logistics revenue declined by 6.1% yoy due to portfolio rationalization. EBITDA fell 83.6% yoy on account of increased bad debts and back-dated reconciliation claims.
SIS has mentioned that it is in process of raising ~Rs1,000cr worth of funds for acquisitions, which may be carried out in FY19 to drive inorganic growth.
Security & Intelligence Services India Ltd ended at Rs. 1,237.80, up by 27.7 points or 2.29% from its previous closing of Rs. 1,210.10 on the BSE.
The scrip opened at Rs. 1,237.10 and touched a high and low of Rs. 1,237.80 and Rs. 1,209.05 respectively. A total of 34,027(NSE+BSE) shares were traded on the counter. The stock traded below its 50 DMA.
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