Patel Engineering - An Engineering Behemoth: IDBI Capital

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..IDBI Capital Report.Patel Engineering Ltd. founded in 1949, is into construction of complex civil infra work like hydro power plant, tunnelling, Urban Infra, irrigation and others. It has seen multiple capex cycle in India, and currently has an order book of Rs 191 billion (which is four times trailing twelve months revenue). Up-cycle in its order inflow has started post Covid and in FY23 it has received highest ever annual order inflow of Rs 78 billion. Company is one the major beneficiary of Infra capex for hydro plant and it expect bidding opportunity of 30 giga watt plus in sector. After reporting revenue compound annual growth rate in double digit at 18% over FY20-23, its year-to-date-FY24 revenue increased by 20% YoY. Leverage in Patel Engineering has tapered off to 0.6x in 9M FY24 versus ~one time before Covid. This is led by internal accrual, non-core asset sale and equity raise in the last four years..Key riskOpportunity is huge but if/any delay in award of orders could impact growth trajectory. Change in the order book mix away from high margin hydro work could impact margin. Stretch in working capital and increase in the short term debt, company will have to maintain leverage under control. Patel Engineering operates in a highly competitive environment and increase in competitive intensity can pose risk to growth..Click on the attachment to read the full report:.Tata Motors - In A Strong Position Operationally: Prabhudas Lilladher.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Patel Engineering - An Engineering Behemoth: IDBI Capital

The company has order book of Rs 191 billion is from sector like hydro, irrigation, tunnel work, which contributes 90% to its book.

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