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Nirmal Bang Report
Dilip Buildcon Ltd. has reported mixed results for Q4 FY22, with the revenue coming in 10% below our estimate and Ebitda coming in 6.5% ahead of our estimate.
Profit after tax at Rs 30 million was ahead of our expectation of a loss of Rs 172 million. Despite the marginal beat on Ebitda/profit after tax, the overall numbers remained below par as Dilip Buildcon has various legacy projects which do not have price escalation clauses, thus affecting margins.
Ebitda margin came in at 9.5%, down 615 bps YoY on account of legacy fixed cost projects and commodity cost inflation.
We were skeptical about the company's capital-intensive business model wherein investments in fixed assets and inventory were much higher than other construction companies.
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