Nuvama Institutional Equities has actually kept its ‘Buy’ score on Texmaco Rail & & Engineering Ltd yet cut its rate target on train supply on worries over greater financial debt message the JRIL procurement. For the September quarter, Texmaco Rail clocked a 123 percent rise in revenue after tax obligation on a 39 percent YoY boost in profits.
“Higher debt post-JRIL acquisition leads us to slash FY25, FY26 and FY27 standalone EPS by 8 per cent, 8 per cent and 7 per cent, respectively. We continue valuing the company on a standalone basis and have not ascribed any value to JRIL as of now; maintain ‘BUY’ with a revised target price of Rs 320 (Rs 331 earlier) as we roll forward valuations to 50x Q2FY27 P/E,” Nuvama stated.
For the quarter, Texmaco Rail’s Ebitda margin decreased 100 bps YoY to 8.3 percent. While the wagon and the Bright Power sector supplied healthy and balanced margins, the rail-EPC (Kalindee) sector clocked losses because of tradition agreements, Nuvama stated.
Wagon manufacturing for Texmaco Rail in Q2FY25 can be found in at 2,443 versus 1,967 in Q1FY25. JRIL generated virtually,900 wagons in H1FY25 with 15– 16 percent Ebitda margins.
Texmaco finished Q2FY25 with an internet order publication of around Rs 7,460 crore. This leaves out the Rs 830 crore order publication of JRIL. The wagon order publication made up 55 percent of the total order publication. Private wagons added 13 percent to the wagon order publication.
Nuvama stated Indian Railways has actually currently granted 7,600 wagons YTD in FY25 while extra wagon tenders remain in the pipe. Higher federal government targets for rolling supply purchase declare for the business, it stated.
During the quarter, the business got JRIL (currently rechristened as Texmaco West Rail) for Rs 615 crore to broaden its item offerings in the middle of the rising train capex.
It clocked income of Rs 430 crore and PBT of Rs 63 crore in H1FY25. It takes pleasure in a lot better success than the moms and dad business as it concentrates mostly on rewarding economic sector wagon orders, Nuvama stated.
“Texmaco’s net working capital cycle improved QoQ to 180 days (183 days at end-Q1FY25). Net D/E is at a healthy 0.26x,” it stated.
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