Nuvama Institutional Equities has really stored its ‘Buy’ rating on Texmaco Rail & & Engineering Ltd but lower its charge goal on practice provide on worries over larger monetary debt message the JRIL procurement. For the September quarter, Texmaco Rail clocked a 123 p.c rise in income after tax obligation on a 39 p.c YoY enhance in earnings.
“Higher debt post-JRIL acquisition leads us to slash FY25, FY26 and FY27 standalone EPS by 8 per cent, 8 per cent and 7 per cent, respectively. We continue valuing the company on a standalone basis and have not ascribed any value to JRIL as of now; maintain ‘BUY’ with a revised target price of Rs 320 (Rs 331 earlier) as we roll forward valuations to 50x Q2FY27 P/E,” Nuvama said.
For the quarter, Texmaco Rail’s Ebitda margin decreased 100 bps YoY to eight.3 p.c. While the wagon and the Bright Power sector provided wholesome and balanced margins, the rail-EPC (Kalindee) sector clocked losses due to custom agreements, Nuvama said.
Wagon manufacturing for Texmaco Rail in Q2FY25 will be present in at 2,443 versus 1,967 in Q1FY25. JRIL generated nearly,900 wagons in H1FY25 with 15– 16 p.c Ebitda margins.
Texmaco completed Q2FY25 with an web order publication of round Rs 7,460 crore. This leaves out the Rs 830 crore order publication of JRIL. The wagon order publication made up 55 p.c of the overall order publication. Private wagons added 13 p.c to the wagon order publication.
Nuvama said Indian Railways has really at present granted 7,600 wagons YTD in FY25 whereas further wagon tenders stay within the pipe. Higher federal authorities targets for rolling provide buy declare for the enterprise, it said.
During the quarter, the enterprise acquired JRIL (at present rechristened as Texmaco West Rail) for Rs 615 crore to broaden its merchandise choices in the course of the rising practice capex.
It clocked revenue of Rs 430 crore and PBT of Rs 63 crore in H1FY25. It takes pleasure in lots higher success than the mothers and pop enterprise because it concentrates totally on rewarding financial sector wagon orders, Nuvama said.
“Texmaco’s net working capital cycle improved QoQ to 180 days (183 days at end-Q1FY25). Net D/E is at a healthy 0.26x,” it said.
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