Salasar Techno Engineering LtdQ3 FY17
Salasar Techno Engineering Ltd
Q3 FY17 Earnings Call Analysis
Management growth scorecard
Revenue
Category 2
Margin
Category 3
Fundraise
N/A
Order
No
Capex
N/A
0 of 3 growth signals are positive — mixed outlook.
Full analysisRevenue guidance
Category 2- →Salasar Techno Engineering Limited expects a CAGR growth of 20%-25% over the next 3 to 5 years.
- →The company closed FY17 with revenue of Rs. 416 crore and targets Rs. 500-510 crore for FY18, reflecting around 20%-25% growth.
- →Half-yearly revenue for H1 FY18 grew 41% to Rs. 216 crore compared to the previous year.
- →Operational efficiencies and strong order inflows indicate positive sales momentum.
- →Telecom sector orders, including a significant Reliance Jio order, provide visibility of Rs. 127-130 crore revenue for H2 FY18 alone.
- →Transmission and EPC segments, especially railway electrification, are expected to contribute to growth, with ongoing bidding activity worth over Rs. 300 crore.
- →The company aims to reach Rs. 1,000 crore in revenue by FY21 or FY22 based on 20% CAGR growth projections.
Margin guidance
Category 3- →Salasar Techno Engineering expects revenue growth of 20%-25% CAGR over the next 3 to 5 years.
- →For FY18, they anticipate closing with 20%-25% growth compared to the previous year.
- →EPS grew by 27% in Q2 FY18 and 35% in H1 FY18 year-on-year.
- →EBITDA margins are sustainable around 10.5%-11%, with 11% considered a benchmark.
- →The company sees good growth prospects in telecom, transmission, and railway electrification sectors.
- →They expect steady order inflows from Reliance Jio and other clients, supporting robust revenues.
- →Operational efficiencies and favorable product mix (e.g. better margin EPC projects) contribute positively to margins.
- →Long-term target revenue of approximately Rs. 1000 crores by FY21 or FY22 based on current growth rates.
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Fundraise plans
- →There is no mention of any current or planned fundraising through debt or equity in the transcript of the Salasar Techno Engineering Limited Q2 & H1 FY18 earnings call held on November 16, 2017.
- →The discussion focuses on business growth, order book status, operational performance, working capital, and margins.
- →Cash flow management strategies such as paying suppliers immediately to avail trade discounts were mentioned, suggesting internal fund management.
- →No specific plans or intentions for raising capital via debt or equity were disclosed during the call.
Order book
No- Current order book stands at more than ₹400 crores.
- Telecom order backlog about ₹140 crores, including regular orders and confirmed purchase orders.
- Transmission order book around ₹170 crores, including EPC projects and L1 status for Himachal Pradesh transmission order (₹49 crores).
- Solar segment order book above ₹30 crores.
- Other segments contribute over ₹10 crores.
- Recent major order: Reliance Jio, 1,700+ towers worth ₹112 crores received in Q3.
- Export orders of about ₹20 crores in H1, with an ongoing ₹10 crores order expected to be completed in 3 months and another expected ₹15 crores order.
- Bidding actively on transmission projects worth more than ₹300 crores.
- Qualified for Power Grid bids and are tying up with larger EPC companies.
- Himachal Pradesh transmission order LOI awaited post-elections, expected soon.
Overall robust order inflows with strong visibility from telecom and transmission sectors.
Capex plans
The transcript provided does not explicitly mention any current or future capital expenditure (capex), capital investment, or strategic investment plans by Salasar Techno Engineering Limited. Key points related to investments or capacity include:
- Installed capacity stands at about 100,000 metric tonnes.
- The company is confident in increasing its reach to more clients with its skilled team.
- Focus is on operational efficiencies and growing order book across telecom, transmission, solar structures, and poles segments.
- No specific announcements regarding new capex or strategic investments were discussed.
Therefore, based on the provided transcript, there is no direct information on current or planned capex or strategic investments.
How does Salasar Techno Engineering Ltd rank vs peers in Industrial Manufacturing?
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