Any current/future new fundraising through debt or equity?

The company plans to infuse Rs. 232 crores as equity into the Sabarkantha HAM project over two years. Currently, the equity infusion is partly planned, with about 50% being infused initially. They are targeting financial closure for the Gujarat HAM project (Shamlaji-Chiloda) by October 2017. Debt of around Rs. 542 crores is planned for the Gujarat HAM project to finance part of the Rs. 1,150 crores EPC contract. No specific mention of new fundraising beyond the equity infusion and planned debt for the Gujarat HAM project. The company is on track to become debt-free on a standalone basis by the

Any current/future capex/capital investment/strategic investment?

Atlanta Limited plans to invest Rs. 232 crores as equity in the Sabarkantha HAM project over two years, with about 50% equity infusion expected initially. The company aims to prudently bid for new EPC projects worth Rs. 800-1000 crores in the current fiscal year, focusing on projects with better margins and existing machinery compatibility. Real estate development projects are underway with visibility for the next 2-3 years, including: - Atlanta Enclave Phase II at Thane (0.75 million sq ft) costing Rs. 350 crores. - Olympic Lifestyles in Jodhpur under affordable housing with Rs. 160 crore

Future growth expectations in sales/revenue/volumes?

Company expects a revenue jump of over 50% from the last fiscal year. EPC segment likely to increase significantly due to the upcoming Gujarat HAM project. Arbitration awards worth about Rs. 200 crores expected in the current fiscal, already realizing Rs. 34.4 crores. EBITDA margins: Arbitration awards ~85%-90%, toll collections ~90%, EPC and real estate 20%-25%. Order book stands at around Rs. 1,500 crores, providing visibility for over 2 years. Plan to bid for an additional Rs. 800-1,000 crores worth of projects in the current fiscal. Real estate projects progressing with affordable housing

Future growth expectations in earnings/operating earnings/profits/EPS?

Atlanta Limited expects a significant revenue jump of over 50% in FY18 compared to last fiscal. EBITDA margins are strong: ~90% for toll projects, 20-25% for EPC and real estate projects. Arbitration awards of around Rs. 200 crores expected in FY18, with Rs. 34.4 crores realized in Q1. EPC segment likely to see growth, especially with the upcoming Gujarat HAM project starting around October 2017. Real estate segment anticipates revenues of Rs. 40-45 crores from Thane project in FY18, with ~20% EBITDA margin. Cost pressures due to GST and material cost increases are expected but partially offse

Current/ Expected Orderbook/ Pending Orders?

As of June 30, 2017, Atlanta Limited's order book stands at around Rs. 1,500 crores (standalone basis, excluding JV project closed with ARSS Infrastructure). The company is qualified to bid for individual projects up to Rs. 1,400 crores with NHAI and other government departments. Currently bidding for projects worth over Rs. 1000 crores in the fiscal year, targeting to add Rs. 800-1000 crores more. The bidding book has projects worth more than Rs. 1,000 crores, with a success ratio of about 12%. Real estate projects provide additional revenue visibility with ongoing and planned developments to

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Atlantaa LtdQ2 FY17Construction

Atlantaa Ltd Q2 FY17 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹39.6Market Cap: ₹333 CrSector: Construction

Management growth scorecard

Revenue

Category 2

Margin

Category 4

Fundraise

Yes

Order

Capex

Yes

2 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 2

→Company expects a revenue jump of over 50% from the last fiscal year.
→EPC segment likely to increase significantly due to the upcoming Gujarat HAM project.
→Arbitration awards worth about Rs. 200 crores expected in the current fiscal, already realizing Rs. 34.4 crores.
→EBITDA margins: Arbitration awards ~85%-90%, toll collections ~90%, EPC and real estate 20%-25%.
→Order book stands at around Rs. 1,500 crores, providing visibility for over 2 years.
→Plan to bid for an additional Rs. 800-1,000 crores worth of projects in the current fiscal.
→Real estate projects progressing with affordable housing focus, especially Thane (Rs. 40-45 crores expected revenue this year) and Jodhpur projects.
→New projects like Atlanta Heights expected to start impacting revenue from next year.
→Financial close expected soon for Gujarat HAM project, with construction revenue anticipated from October 2017.

Margin guidance

Category 4

→Atlanta Limited expects a significant revenue jump of over 50% in FY18 compared to last fiscal.
→EBITDA margins are strong: ~90% for toll projects, 20-25% for EPC and real estate projects.
→Arbitration awards of around Rs. 200 crores expected in FY18, with Rs. 34.4 crores realized in Q1.
→EPC segment likely to see growth, especially with the upcoming Gujarat HAM project starting around October 2017.
→Real estate segment anticipates revenues of Rs. 40-45 crores from Thane project in FY18, with ~20% EBITDA margin.
→Cost pressures due to GST and material cost increases are expected but partially offset by government claims.
→Standalone debt expected to be reduced further, aiming to become debt-free by end of FY18, improving financial viability.
→The company aims to infuse Rs. 232 crores equity in the Sabarkantha project, supporting future growth.
→Overall, positive earnings and cash flow outlook with improved bottom-line expected from arbitration awards and new projects.

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Fundraise plans

Yes

→The company plans to infuse Rs. 232 crores as equity into the Sabarkantha HAM project over two years.
→Currently, the equity infusion is partly planned, with about 50% being infused initially.
→They are targeting financial closure for the Gujarat HAM project (Shamlaji-Chiloda) by October 2017.
→Debt of around Rs. 542 crores is planned for the Gujarat HAM project to finance part of the Rs. 1,150 crores EPC contract.
→No specific mention of new fundraising beyond the equity infusion and planned debt for the Gujarat HAM project.
→The company is on track to become debt-free on a standalone basis by the end of the current financial year, implying no immediate standalone debt fundraising.
→They aim to use arbitration awards receivables (~Rs. 1100 crores expected over two years) partly for debt repayment and partly to support future projects.

Order book

→As of June 30, 2017, Atlanta Limited's order book stands at around Rs. 1,500 crores (standalone basis, excluding JV project closed with ARSS Infrastructure).
→The company is qualified to bid for individual projects up to Rs. 1,400 crores with NHAI and other government departments.
→Currently bidding for projects worth over Rs. 1000 crores in the fiscal year, targeting to add Rs. 800-1000 crores more.
→The bidding book has projects worth more than Rs. 1,000 crores, with a success ratio of about 12%.
→Real estate projects provide additional revenue visibility with ongoing and planned developments totaling around Rs. 585 crores in project cost.
→Financial closure for the Gujarat HAM project expected by October 2017, with commencement thereafter.
→Overall order book provides revenue visibility for over 2 years.

Capex plans

Yes

→Atlanta Limited plans to invest Rs. 232 crores as equity in the Sabarkantha HAM project over two years, with about 50% equity infusion expected initially.
→The company aims to prudently bid for new EPC projects worth Rs. 800-1000 crores in the current fiscal year, focusing on projects with better margins and existing machinery compatibility.
→Real estate development projects are underway with visibility for the next 2-3 years, including:
→ - Atlanta Enclave Phase II at Thane (0.75 million sq ft) costing Rs. 350 crores.
→ - Olympic Lifestyles in Jodhpur under affordable housing with Rs. 160 crores project cost.
→ - Atlanta Heights at Kandivali (0.15 million sq ft) with Rs. 75 crores project cost in initial development.
→Financial closure for the Shamlaji-Chiloda HAM project (approx Rs. 1150 crores EPC contract) is expected by October 2017, after which construction will commence.
→The company is becoming debt-free on a standalone basis by this financial year-end, supporting strategic investments.

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