PSP Projects' elevated operating margin steals the showPSPPROJECT - 779 Change: 8.55 (1.11 %)
News: PSP Projects' revenue at standalone level improved 8.8% YoY to Rs 345.2 crore. Operating margin remained at an elevated level of 13.6% (up 123 bps YoY) likely backed by better project mix and benefits accruing with completion of some projects. Effectively, operating profit at Rs 47.1 crore, was up 19.6% YoY. At net level, PAT improved 13.6% YoY to Rs 28.5 crore.
View: PSP reported a mixed operational performance during Q1FY23. While PSP's performance at topline level missed our expectations possibly due to slowed-down execution in certain projects, margin remains at an elevated level despite ongoing volatility in input prices. This resulted in beat at bottom-line levels too. Going forward, comfortable order book position, decent margins, comfortable leverage, and healthy working capital remains key positive.