Sadbhav Engineering Limited (SEL) yet again disappointed on execution front during Q1FY2021 with standalone revenues declining by 73% y-o-y to Rs. 230 crore. However, OPM beat expectations (although falling 402 bps y-o-y to 8.5%) as gross margins improved. Lower revenue affected by COVID-19 led challenges and a dip in OPM led to a standalone net loss of Rs. 26.6 crore (higher than our expectation of a net loss of Rs. 22 crore). However, post Q1FY2021, SEL has seen labour availability and execution run-rate improving to 70-80% and 60-70%, respectively, from July 2020. It expects to achieve labour availability of 90100% and normalized execution run-rate from October 2020 onwards. Hence, the...