ISGEC Heavy Engineering Q1 Results Review- Manufacturing Led To Good Quarter, Maintain 'Buy': ICICI Securities

ICICI Securities Report

ISGEC Heavy Engineering Ltd. reported a good set of numbers for Q1 FY24 with standalone revenue/Ebitda/profit after tax up 14%/35%/112% YoY to Rs 11.3 billion / 766 million / 637 million respectively.

Performance was aided by growth in the manufacturing business of ISGEC Heavy Engineering. Current orderbook stands at Rs 84 billion, +9% YoY. Enquiry pipeline remains robust in both domestic and international product-segments.

Key sectors witnessing traction are: power, sugar, steel, cement, and ethanol. Net working capital situation is likely to improve with execution of flue-gas desulfurisation orders. Execution of biofuel plant in Cavite, Philippines, is on track and likely to start commercial operations by November 2023.

Management indicated strong business outlook for its subsidiaries. Maintain 'Buy' with a revised SoTP-based target price of Rs 880 (earlier: Rs 698).

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