This defence company made a new 52-week high of Rs 3,428 on Monday as the company won orders worth Rs 8,073 crore from the Ministry of Defence, to manufacture 34 Dhruv Mk-III helicopters. According to the Ministry, the Army will get 25 and the Coast Guard will receive nine helicopters.
The company also got another deal this month worth Rs 5,300 crore to manufacture advanced engines for existing MiG-29 fighter jets. At the same time, it received a hike in its contract value for the development of Tejas fighter jets. According to a regulatory filing, the value of the contract has been revised to Rs 5,078 crore from Rs 2,701 crore earlier. The Indian Air Force plans to replace its aging MiG-21 aircraft with the Tejas Mark 1A by 2025.
In Q3FY24, the company’s net profit increased by 9.2% YoY to Rs 1,261.4 crore, while revenue went up by 5.8% YoY to Rs 6,521.3 crore. The EBITDA margin expanded by 629 bps YoY to 23.7%, led by lower provisions which fell 38% YoY.
Chairman and Managing Director, C.B. Ananthakrishnan, emphasized the company's goal of expanding into the civil helicopter market, focusing on areas like air ambulance services, helicopter tourism, and offshore operations. Meanwhile, the capital outlay on aircraft and aero-engines for defence forces in the interim budget for FY25 has increased 44% YoY to Rs 40,800 crore from Rs 28,200 crore in FY24.
Prabhudas Liladhar highlights demand opportunities for the company owing to the government’s push for indigenous procurement in defence. They note that the company has a robust order book with a further five-year pipeline of Rs 2 lakh crore. The analysts have a ‘Hold’ rating as the stock is trading at a premium valuation. Analysts at CLSA however, gave the company an ‘Outperform’ rating with a target price of Rs 3,225.
This telecom services company has risen by 2.1% today, after it announced a couple of network footprint enhancement plans under its rural enhancement project in the Alappuzha and Bharuch District covering a total of 5,954 villages and 17 towns. The company is targeting rural areas including highways, tourist destinations and trade centers to gain over 40% revenue market share in the next 12-18 months and to bridge the gap with market leader Reliance Jio.
In Q3FY24, the company's net profit grew by 53.8% YoY to Rs 2,442.2 crore and revenue increased marginally by 6.3% YoY on the back of a 11.8% YoY increase in the Indian mobile services. But it saw a 7.1% YoY decline in the African mobile services segment, which accounts for 27% of the total revenues. In Africa the company serves 14 countries out of which Nigeria’s customer base growth was affected by new National Identity Number (NIN)/SIM regulations. While the firm beat Trendlyne Forecaster’s revenue estimate by 0.1%, it missed net profit estimate by 16.7% due to the decline in the overseas mobile services and weak digital TV profit margins.
The company added a net of 18.5 lakh wireless subscribers at the end of Q3 and saw a rise in market share of active wireless subscribers both sequentially and YoY to 36%. The company leads the average revenue per user (ARPU) in the industry which rose by 7.8% YoY to Rs 208 due to a richer product mix. Reliance Jio’s ARPU in comparison, was Rs 181.7 in Q3. The company anticipates ARPU to rise to Rs 300 due to 2G&3G consumer conversion to 4G and plans to focus on key markets in South, Maharashtra, and Bengal.
Gopal Vittal, MD & CEO of the firm, said, “Revenue from the India business sustained its momentum, while the consolidated revenue was impacted by the devaluation of the Nigerian Naira and Malawian Kwacha. We remain on course with our strategy of premiumization that helped us add 7.4 million 4G/5G customers.”
Axis Securities recommends a ‘Buy’ for Airtel with a target price of Rs 1,400. They say “Given the company’s strong recovery potential and strong conversion, rising digital portfolio, and moderated capex, we value the stock at Rs 1,400/share – a robust upside.”
This electric utilities company hit its all-time high of Rs 1,287.5 on Monday after announcing an order win worth Rs 1,540 crore to set up grid-connected solar PV projects in Nasik. The company has won several other projects over the past month, including a Rs 2,700 crore order from Railway Energy Management to supply round-the-clock renewable power, and an order from NTPC Vidyut Vyapar Nigam to supply power, with a minimum revenue potential of Rs 440 crore. Additionally, it won a 35-year build, own, operate and transfer contract from PFC Consulting with annual transmission charges of Rs 50 crore. Speaking about the rising order pipeline, General Manager Rishi Shah said, “There is an ongoing, good pipeline of projects in which we have bid, and we are hopeful that we'll be able to get them.”
Torrent Power’s profit for Q3FY24 fell 47.4% YoY to Rs 359.8 crore, while revenue fell by 1.6% YoY. The profit decline was due to a rise in higher depreciation and finance expenses. It also missed Trendlyne Forecaster’s profit and revenue estimates by 39.1% and 8.7%, respectively. However, the company posted strong operational numbers during the quarter, generating 1,994 MU of power, a 62% increase YoY. The firm appears in a screener for stocks with PE higher than their industries.
Torrent Power has an aggregate installed generation capacity of 4,287 MW and has renewable projects of 1,402 MW under development. Managing Director Jinal Mehta mentioned that the company will invest Rs 47,000 crore in Gujarat's green energy plan. The firm has also received an allocation of 18 KTPA of green hydrogen production under the solar PV PLI tender, at an average PLI of Rs 28.9 per kg.
Geojit BNP Paribas gives Torrent Power a ‘Sell’ call due to softening gas prices. The brokerage is cautious over the execution risks in renewable capacity additions, current high valuations, and the recent rise in stock price (up 59.1% in the past six months).
This digital payments player saw its parent company One97 Communications’ share price hit the upper circuit on Friday, after it got the nod from NPCI for a third-party application provider licence. The NPCI approval for PayTM came just in time, as Paytm Payments Bank ceases operations today.
The licence approval allows PayTM to continue with payments after PPB stops operations. Axis Bank, HDFC Bank, SBI and YES Bank will be the payment service provider banks for PayTM. YES Bank will be the merchant acquiring bank for both existing and new merchants, which means that the @Paytm handle will now redirect to YES Bank for transactions.
Paytm's business model – minus PayTM Payments Bank, and with this licence – is now more like pure payment service companies like PhonePe and Google Pay.
CFO Madhur Deora had estimated the “worst case scenario” of RBI’s action against PayTM at Rs. 300-500 crore impact on annual EBITDA, which is unlikely now that the business has received the licence. But PayTM is not yet completely out of the woods. One lingering question is how successful it will be in retaining its merchant base in the coming months, with competitors eyeing its customers in the wake of PayTM’s reputational damage. The merchants are key to Paytm’s bottomline. The average ticket size of PayTM’s merchant loans was Rs 2 lakh at the end of Q3FY24, Rs. 30,000 higher than the personal loan average.
UBS Securities recently highlighted the churn that is likely in PayTM’s customer and merchant base. It estimated this at 15-20%, with a 60% QoQ decline in loan origination.
Analysts have been increasingly lukewarm on the stock since the RBI action – the Forecaster consensus is ‘Hold’. A major complaint from the regulator – weak corporate governance – is still visible. As analysts point out, Vijay Sekhar Sharma remains MD, Chairman and CEO of the company. PayTM seems reluctant to reform unless pushed, and regulators as a result may continue to side-eye the company on its various corporate governance and transparency issues.
This construction & engineering stock fell by 8.6% on Wednesday as the broader market declined. However, it recovered sharply on Thursday to rise by 9.4% after its joint venture (JV) with Salasar Techno Engineering bagged an order worth Rs 174 crore from Madhya Pradesh Power Transmission. The company has also won eight other orders since February 7.
The largest order is worth Rs 888.6 crore from the Himachal Pradesh State Electricity Board, received on February 7, 2024 to develop the distribution network in the South Zone of the state. The project is expected to be completed in the next 24 months.Other wins include new orders from the Madhya Pradesh Metro Rail Corp, and the Himachal Pradesh State Electricity Board. At the start of the year, the company also reportedly signed a memorandum of understanding (MoU) with REC to fund infra projects up to Rs 35,000 crore.
Commenting on the results, management said, “We have been actively exploring opportunities in Central Asia, the UAE, and Western Asia alongside our operations in the UAE. As a result, we anticipate achieving a profit that aligns with our performance in other sectors.”
However, despite a good order book, the company’s revenue reduced by 6.4% YoY in Q3FY24 to Rs 4,689.3 crore due to a high number of orders being in the execution phase. The management believes revenue is largely in line with the expectations of Rs 22,000 crore in FY24, despite falling during Q3FY24. It posted a revenue of Rs 16,080.5 crore in the first three quarters of FY24 and it expects the balance to be achieved in Q4FY24. However, its net profit declined by 6.2% YoY on the back of its taxes increasing by 74% YoY to Rs 112.8 crore during the quarter.
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