Thermax, BUY
Meet Expectation
Price Rs621 Target Price Rs954
Q3FY2008 consolidated results for Thermax are in line with our estimates. Thermax posted a 57.0% yoy growth in revenues to Rs9335 mn, in line with our expectations. Robust performance of energy and environment segment contributed to strong growth. EBIDTA grew lower than revenue growth at 52.4% yoy to Rs1095 mn, but meet expectations. The net profit before exceptional grew by 57.3% yoy to Rs798 mn, ahead of estimates. The consolidated order book as on December, 2007 stood at Rs29.2 bn against Rs30.2 bn as same period last year. We maintain a positive view on the company amidst enabling and supportive business environment. At CMP of Rs620, Thermax is trading at PER of 14.5X FY2010E and EV/EBIDTA of 7.8X FY2010E. We maintain BUY rating with a 18-month price target of Rs954, an upside of 53.8%.
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