Buy Simplex Infrastructures, target of Rs 650: Firstcall
Published on Wednesday, December 2nd, 2009 at 12:06 PMAuthor: stockalert (2026 Articles)
Firstcall India maintains ` Buy ` on Simplex Infrastructures with a price target of Rs 650 as against the current market price (CMP) of Rs 525 (Nov. 24, 2009).
The broking house said, for the quarter ended on September 30, 2009 (Standalone) the company has registered a 1.70 % (YOY) growth in the net sales and stood at Rs 10,252.0 million from Rs 10,080.9 million of the corresponding period of the previous year.
The operating profit margins for the quarter stood at 10.39%.The management indicated that the margin on the existing order book stands at 10.5- 10.8%, and the incremental orders are at better margins.
Also, change in composition of order book towards power segment is positive, given better margins. The operating profit for the quarter stood at Rs 1,065.10 million from Rs 900.60 million, for the same quarter of last year.
During Q2FY10 the net profit of the company stood at Rs 279.2 million. EPS for the quarter stood at Rs 62 per equity share of Rs 2.00.
Simplex Infrastructures is one of the top five infrastructure solutions providers in India with a proven track record of 80 years. The company`s current order book stands at Rs 105.00 billion, which represents 2.21x of FY09 revenue and provides strong revenue visibility for the near-to-medium term.
The company is scouting for acquisitions in other infrastructure sectors including power transmission, ports, hydro, railways and water supply. The company has forayed into On-shore Oil rigging business with purchase of 1500 HP rig costing Rs 500 million.
Recently Simplex Infra has entered in to real estate development through joint venture. Net sales and net profit of the Company are expected to grow at a CAGR of 27.54% &22.48% over FY08 to FY11E.
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