Emkay Global Financial is bullish on Triveni Turbines has recommended buy rating on the stock with a target price of Rs 88 in its research report dated June 16, 2020.
Emkay Global Financial's report on Triveni Turbines
Triveni Turbine's Q4FY20 revenues fell 36% yoy to Rs1.54bn, driven by a 61% decline in domestic revenues even as exports were up 6% yoy. The sharp drop in revenues was caused by the lockdown and had a cascading effect on profitability. As per the company, despite the pandemic, enquiries in the oil & gas space has improved significantly due to better value proposition offered by the company. TRIV is also working with several consultants where acceptance during the lockdown has been encouraging. While FY21 may witness a 10-15% decline in revenue on account of execution challenges, management is confident of strong long-term outlook on the back of the stable/improving market share and enquiry base.
Outlook
We cut our FY21/22E EPS by 35%/5% to factor in Covid-19’s impact and lower our TP to Rs88 (from Rs93 earlier at 20x FY22E P/E). Maintain Buy.
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