Va Tech Wabag Ltd posts consolidated net profit of Rs30.10cr in Q3FY18 vs. net loss of Rs25.6cr in Q3FY17

pure-play water technology provider

Feb 10, 2018 03:02 IST India Infoline Research Team

Va Tech Wabag Ltd Q3FY18

Consolidated Results Q3FY18: (Rs cr)

Q3FY18 YoY (%)
Revenue 864.70 20.4
EBITDA 77.70 [2.2]
EBITDA Margin (%) 8.98 [208]
Net Profit (adjusted) 30.10 0
***EBITDA margin change is bps
View

Buy

Reco. Price

578

Last updated on

08-Feb-2018

Va Tech Wabag’s Q3FY18 consolidated sales increased by 20.4% yoy to Rs864.7cr from Rs718.3cr in Q3FY17. EBITDA declined by 2.2% yoy to Rs77.7cr from Rs79.4cr in Q3FY17, while EBITDA margin dropped from 11.1% in Q3FY17 to 9% in Q3FY18. The company reported net profit of Rs30.1cr in Q3FY18 vs. net loss of Rs2.6cr in Q3FY17.

• Raw material cost as a proportion to sales has increased from 75% in Q3FY17 to 79% in Q3FY18.
• Other expenses and employee cost have increased at a lower rate by 6.2% yoy and 1.6% yoy.
• Finance cost has increased by mere 3.6% yoy to Rs14.2cr during the quarter, while other income has declined by 75.9% yoy to Rs84lakhs.
• Decline in other income and higher tax rate restricted the net profit to Rs30.1cr. The net loss in Q3FY17 was a result of Rs60.5cr of liquidated damages (LD) pertaining to the Oman desalination project.
• Gross sales from the India business (~26% of Q3FY18 sales) declined by 12% yoy to Rs226.8cr, while overseas sales (~74% of Q3FY18 sales) increased by 36% yoy to Rs648.5cr.
• EBIT margin in the India business improved from 16.8% in Q3FY17 to 17.8% in Q3FY18. EBIT margin in the overseas segment increased from 15.3% in Q3FY17 to 21.3% in Q3FY18.
• The company had Rs230cr order intake in Q3FY18 taking its 9MFY18 order inflow to Rs1,440cr. It has maintained the full-year guidance of Rs4,300-4,500cr. Management reiterated that the company  has contracts worth Rs1,900cr in which it is the L1 bidder and it targets 50% conversion rate.
• The company reported order backlog of Rs6,520cr (down 14% yoy but excluding Rs680cr worth of orders in its framework contract book).
• Outlook for FY19 is robust as Mumbai sewage treatment plants (STPs), four integrated cities related to Namami Gange, a desalination plant and a water treatment plant in Mathura are likely to see order awards. Execution of all existing projects remains on track.
• Working capital days improved to 94 days as of end of Q3FY18 from 101 days as of end of Q2FY18. Net debt has come down by Rs190cr qoq to Rs160cr.


Technical View:

Va Tech Wabag Ltd ended at Rs. 573.15, up by 1.1 points or 0.19% from its previous closing of Rs. 572.05 on the BSE.
The scrip opened at Rs. 565.70 and touched a high and low of Rs. 578 and Rs. 565 respectively. A total of 60,800(NSE+BSE) shares were traded on the counter. The stock traded above its 200 DMA.


Related Story

Open Free Demat Account (Rs699)