Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us    
Google
Web www.equitybulls.com
Research

| More

Maintain BUY on JMC Projects - Long wait - HDFC Securities

Posted On: 2020-05-22 14:55:47


Mr. Parikshit D Kandpal, Institutional Research Analyst, HDFC Securities.

JMC Projects (Q4FY20): Long wait. Maintain BUY
(TP Rs 69, CMP Rs 35, MCap Rs 6 bn)

JMC Project Ltd (JMC) 4QFY20 financial performance was impacted by ECL provisioning of Rs 795mn in the Kurukshetra Expressway BOT toll project. Adjusted for the same the APAT beat stood at 26.8%. Whilst FY20 saw weak order intake of Rs 33.6bn, 1QFY21 has started on strong footing with new order wins of Rs 11.3bn and L1 of Rs 18bn. We expect FY21E to be turnaround year for JMC as (1) Likely restructuring of 3 BOT assets will cut loss funding to Rs 500mn (vs. Rs 800mn for FY20) (2) New orders bookings have been strong for 1QFY21 & (3) International geographies have started contributing to order inflows. We maintain BUY with SOTP of Rs 69/sh.

One-offs impacted 4QFY20 financial performance: During 4QFY20, JMC recorded Expected Credit Loss provision of Rs 795mn on loans given to its JV (49.5% JMC's share) Kurukshetra Expressway (BOT). JMC has been funding the liabilities servicing for this project through standalone. ECL provision is a step towards BOT restructuring. Adjusted for same Rev/EBIDTA/APAT beat/(miss) stood at (6)/5.5/27%. The 4 BOT Assets contributed Rs 376/1,530mn to the revenues and Rs 204/670mn net loss at a consolidated level in 4QFY20/FY20.

Gradual execution ramp up in place: JMC has Rs 95.5bn of order backlog as of FY20 end (ex of Rs 11.3bn new wins in 1QFY21 and L1 of Rs 18bn). About 42% of the order book in infra (largely water) which has reached 80% utilization level. Balance 58% is Buildings and factories where labour force force has reduced from 18,000 to 10,000 people. JMC expects 80-85% labour availability by 2QFY21 end. Hence, 1QFY21 will be severely impacted with JMC guiding for Rs 5-5.5bn of Revenue (50% of quarter average) and good improvement from 2QFY21.

Road BOT asset restructuring key for re-rating: JMC is in advances stages of restructuring the 3BOT assets (Wainganga, Kurukshetra and Vidyanchal expressway). As a step towards same, JMC has already taken investment write off of Rs 795mn in Kurukshetra project during 4QFY20. We believe that FY21E will be crucial and this may be JMCs best chance to achieve the same. Banks need to take a final call on the same. Total equity exposure now stands at Rs 8.2bn including Rs 760mn loss funding investment for FY20. Resolution in these BOT assets continue to be a key monitorable.

We maintain BUY on JMC as we see FY21E to be turnaround year for the company. Large part of BF order book ~85% is in Southern India which remains better placed for real estate recovery. New opportunities are being explored in Africa from order booking perspective. Net debt has increased by Rs 1bn YoY to Rs 7.8bn and net D/E is 0.8x, which is a cause of concern but manageable. FCFE for FY20 stood at Rs 425mn.

Shares of JMC PROJECTS (INDIA) LTD. was last trading in BSE at Rs.35 as compared to the previous close of Rs. 33.35. The total number of shares traded during the day was 13963 in over 90 trades.

The stock hit an intraday high of Rs. 35 and intraday low of 31.9. The net turnover during the day was Rs. 482094.


Source: Equity Bulls

Click here to send ur comments or to feedback@equitybulls.com


Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only. www.equitybulls.com, its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. www.equitybulls.com or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.





Other Headlines:

Maintain ADD on Torrent Pharma - Stable performance, Resilient outlook - HDFC Securities

Analysis on ITC acquiring 100% equity stake in Sunrise Foods Pvt Ltd - HDFC Securities

Maintain ADD on Trent - Savings in Cost of Retailing > GM dilution - HDFC Securities

Maintain SELL on Avenue Supermarts - Un-DMARTesque! - HDFC Securities

Maintain ADD on DCB Bank - Attractive amidst visible headwinds - HDFC Securities

Maintain ADD on Colgate Palmolive - Muted Q4, signs of improving execution - HDFC Securities

Maintain BUY on JK Lakshmi Cement - Strong margin uptick; Healthy balance sheet - HDFC Securities

Maintain BUY on Kalpataru Power Transmission - Multiple triggers - HDFC Securities

Maintain ADD on BSE - Fighting back, cash support - HDFC Securities

Colgate Palmolive Q4FY20 Result First Cut - Miss on all fronts - HDFC Securities

Maintain ADD on L&T Infotech - Q4FY20 Results Review - HDFC Securities

Maintain Reduce on Dr. Reddy's Labs - Valuations leave little room for disappointment - HDFC Securities

Maintain BUY on UltraTech Cement - Robust margin and leverage performance - HDFC Securities

Maintain BUY on CDSL - Robust performance continues - HDFC Securities

Downgrade to REDUCE on Jubilant FoodWorks - Good franchise, a pause before run - HDFC Securities

ADD on Bajaj Auto - Resilient margins - HDFC Securities

RIL Right's Issue - Mr. Jyoti Roy, DVP Equity Strategist, Angel Broking Ltd

First Cut Analysis: BUY on UltraTech - Healthy results despite Covid impact - HDFC Securities

BUY on Escorts - Strengthening the core - HDFC Securities

Maintain ADD on Crompton Consumer - Q4FY20 Results Review - HDFC Securities

Maintain ADD on Zensar Technologies - Elusive quest for growth - HDFC Securities

Retain BUY on Nippon Life India Asset Management - Strong core despite market share loss! - HDFC Securities

Maintain ADD on L&T Technology Services - Enduring the ebbs and flows - HDFC Securities

Maintain Buy on Cipla - Positive outlook reaffirmed - HDFC Securities

Maintain BUY on Mahindra & Mahindra Financial Services - Pain inevitable, valuations attractive - HDFC Securities

Maintain SELL on ABB India - Long road to recovery - HDFC Securities

Maintain ADD on Mphasis - Positives outweigh the risks - HDFC Securities

Maintain REDUCE on Siemens - Headwinds remain - HDFC Securities

Maintain ADD on Havells - Recovery Interrupted by Covid - HDFC Securities

ADD on Kotak Mahindra Bank - Stronger than most, but expensive - HDFC Securities

Maintain REDUCE on Godrej Consumers - Weakness continues, exacerbated by Covid - HDFC Securities Institutional Research Desk

First Cut Analysis: Maruti Suzuki India Ltd Q4FY20 Results - HDFC Securities

Vedanta Limited - Voluntary Delisting Proposal - Angel Broking

Shree Cement - Strong show; Valuations remain expensive - Q4FY20 Result Review - HDFC Securities

ICICI Securities - Strong Quarter - Q4FY20 Result Review - HDFC Securities

Cyient - Crash landing - Q4FY20 Result Review - HDFC Securities

ICICI Bank - Well placed for a bumpy ride - Q4FY20 Result Review - HDFC Securities

RBL Bank - Risks to play out - Q4FY20 Result Review - HDFC Securities

Persistent Systems - Growth dichotomy - Q4FY20 Result Review - HDFC Securities

SBI Life Insurance - Challenging Year Ahead - Q4FY20 Result Review - HDFC Securities

Marico - Saffola saves the day - Q4FY20 Result Review - HDFC Securities

AU Small Finance Bank - Better placed vs. peers - Q4FY20 Result Review - HDFC Securities

Reliance Industries - A weak quarter but better visibility on Balance Sheet improvement - Result Review - HDFC Securities

ICICI Lombard - Uncertain times ahead - 4QFY20 Result Review - HDFC Securities

Reliance Retail - Top-line disappoints, margins surprise - Q4FY20 Result Review - HDFC Securities

Hindustan Unilever - Miss led by supply chain disruptions - Q4FY20 Results Review - HDFC Securities

Tech Mahindra - Signal dropped, not lost - Q4FY20 Result Review - HDFC Securities

RIL deal with Silver Lake - Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

Silver Lake's Investment in Reliance Jio - HDFC Securities

Mr. Jyoti Roy, DVP Equity Strategist, Angel Broking Ltd on the Silver Lake - JIO Deal







Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2019