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NCC Ltd – Q3FY23 First Cut
(CMP: Rs 95; MCap: Rs 5933 crore)
Q3FY23 Earnings Summary
Standalone revenue improved 22.5% YoY to Rs 3,312.7 crore (vs. I-direct estimate of 18% growth) backed by its strong order book position and pick-up in execution
Operating margin stood at 10.5% (up 92 bps QoQ and down 30 bps YoY) –higher than I-direct estimated margin of 10%, driven by operating leverage. Effectively, EBITDA at Rs 348.8 crore, was up 19% YoY, higher than estimate of Rs 318 crore
At net level, strong operating performance translated into 65% YoY growth in PAT (to Rs 149.9 crore)
NCC has secured orders aggregating to Rs 5,495 crore during Q3FY23 which has kept its order book at an elevated level of Rs 41,862 crore, 3.4x book to bill on trailing 12 months basis
View: We highlight that while execution has been on improvement trajectory, margins recovery was a positive surprise in Q3. Continued traction could provide upsides to our FY24/FY25 earnings estimates. We await management commentary on future execution and margins outlook, order inflows guidance, status on Andhra Pradesh orders, receivables and net debt. We would be coming out with a detailed report post the conference call.
Impact: Positive