PatelEngineering

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Patel Engineering - Latest Results

(in Cr.)
Sep-11
Jun-11
FY10-11
Revenue
613.26
541.08
2,537.21
Net Profit
29.98
10.23
102.21
EPS
4.3
1.47
14.64
Cash EPS
6.17
3.34
22.2
OPM %
15.52
13.93
14.28
NPM %
4.89
1.89
4.03
 
 
 
 
Results for the quarter ended 30.09.11 for Patel Engineering Ltd

Patel Engineering - Share Price Movement

 
 
 
Weekly H/L
88.7
80.2
Monthly H/L
102.3
80.2
52 Weeks H/L
361
80.2
 
( 22 Nov 10 )
( 21 Nov 11 )
Delivery / Var+ELM %
37.52
14.53
High and Low price of shares of Patel Engineering in the last one year ended 22.11.11

Patel Engineering - Share Price Movement

Patel Engineering - Share Price movement in National Stock Exchange as on 22.11.11
Patel Engineering - Share Price movement in National Stock Exchange as on 22.11.11

Patel Engineering


Q2 results good

Patel Engineering has produced good results for the quarter ended 30.09.11 as compared to the quarter ended 30.06.11. Revenue has increased from Rs.541.08 crore to Rs.613.26 crore. Revenue for the whole year 2010-11 was at Rs.2537.21 crore. Net profit nearly tripled from Rs.10.23 crore to Rs.29.98 crore. Net profit for the whole year 2010-11 was at Rs.102.21 crore. Operating profit margin increased from 13.93% to 15.52%. Net profit margin increased from 1.89% to 4.89%. EPS for the year 2010-11 was at Rs.14.64. Annualised EPS for Q2 works out to Rs.17.20. The company is operating in construction and engineering sector. The shares of Patel Engineering are traded in the bourses at Rs.84.55 now (Bombay Stock Exchange 22.11.11). The highest price recorded by the shares of the company in the last one year is at Rs.361 (22.11.10) and the lowest price is at Rs.80.20 (21.11.11). In other words, the present market price of Patel Engineering is close to its lowest price in the last one year. This gives a temptation for the investors to buy the shares of Patel Engineering at the current market price. Is this temptation justified? Let us analyse.

Rumour about Rs.250 crore order

The market price of shares of Patel Engineering increased by 9% from Rs.90.85 to Rs.98.85 from October 4 to October 14 this year because of a floating rumour that the company was likely to receive an order worth Rs.250 crore. The company neither confirmed it nor denied it. There is anticipation of an increased order for infrastructure sector including engineering and construction from both State and Central governments.

Not keen to bid for roadways projects

Patel Engineering is planning to divest around 15% stake in a 200 MW hydropower project to private equity companies. After this, the company is planning to bid for new projects for Rs.6000 crore in the coming three months. It is reliably learnt that Patel Engineering is not keen to bid for roadways projects of National Highways Authority of India (NHAI) because of cutthroat competition. Rupen Patel is the Managing Director of Patel Engineering.

Infrastructure growth in India

According to Bain & Co report, private equity companies have increased their investment in infrastructure projects in India from $1 billion in 2006 to $4 billion in 2010 – a four fold increase in four years time. It is further expected to grow at a rate of 25% to 50% in the next three years. Patel Engineering is a Mumbai-based company. The company is executing a 200 MW hydropower project in the State of Arunachal Pradesh. The company anticipates financial closure for the project by the end of the year. The company’s order book has crossed Rs.9000 crore. The company’s success rate in bidding of projects is 50%. The company has 50% of its order books from hydropower sector, 33% from irrigation and the balance 17% from transport and urban infrastructure.

Good for medium and long term investment

The company’s share price declined from a high of Rs.375 in June 2010 to the present level. In fact the share price was quoting at Rs.526 in September 2009. At the current price level, there is very little of a further downward risk. Therefore, investors may contemplate buying the shares of Patel Engineering for medium and long term holding.

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