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ICICI Securities has buy call on with a target price of Rs 914. The current market price of ISGEC Heavy Engineering Ltd. is Rs 739.1.
Time period given by analyst is one year when ISGEC Heavy Engineering Ltd. price can reach defined target.
ISGEC Heavy Engineering Ltd., incorporated in the year 1933, is a Mid Cap company (having a market cap of Rs 5176.48 Crore) operating in Engineering sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 1627.46 Crore, up 14.33 % from last quarter Total Income of Rs 1423.42 Crore and up 4.32 % from last year same quarter Total Income of Rs 1560.13 Crore. Company reported net profit after tax of Rs 68.48 Crore in latest quarter.
Investment Rationale
Despite the challenging environment and higher mix of EPC work, the company witnessed positive operating cashflow. The brokerage believes it will be able to come out of the Philippines asset with no major impact, but this continues to be an overhang on the valuation. It rolls over valuation of the stock to FY23E earnings with a standalone target P/E multiple of 20x (increased from 15x earlier given the government’s impetus for infra capex). It values ISGEC Hitachi Zosen at Rs21 (25x FY23E earnings) and the sugar subsidiary at Rs27 (5x FY23E earnings). It maintains BUY on the stock with a revised SoTP-based target price of Rs914 (earlier: Rs577).
Promoter/FII Holdings
Promoters held 62.4 per cent stake in the company as of March 31, 2021, while FIIs held 2 per cent, DIIs 6.9 per cent and public and others 28.7 per cent.
Time period given by analyst is one year when ISGEC Heavy Engineering Ltd. price can reach defined target.
ISGEC Heavy Engineering Ltd., incorporated in the year 1933, is a Mid Cap company (having a market cap of Rs 5176.48 Crore) operating in Engineering sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 1627.46 Crore, up 14.33 % from last quarter Total Income of Rs 1423.42 Crore and up 4.32 % from last year same quarter Total Income of Rs 1560.13 Crore. Company reported net profit after tax of Rs 68.48 Crore in latest quarter.
Investment Rationale
Despite the challenging environment and higher mix of EPC work, the company witnessed positive operating cashflow. The brokerage believes it will be able to come out of the Philippines asset with no major impact, but this continues to be an overhang on the valuation. It rolls over valuation of the stock to FY23E earnings with a standalone target P/E multiple of 20x (increased from 15x earlier given the government’s impetus for infra capex). It values ISGEC Hitachi Zosen at Rs21 (25x FY23E earnings) and the sugar subsidiary at Rs27 (5x FY23E earnings). It maintains BUY on the stock with a revised SoTP-based target price of Rs914 (earlier: Rs577).
Promoter/FII Holdings
Promoters held 62.4 per cent stake in the company as of March 31, 2021, while FIIs held 2 per cent, DIIs 6.9 per cent and public and others 28.7 per cent.
(Disclaimer: Views and recommendations given in this section are the analysts' own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.
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