Results below estimates: Thermax’s (TMX) 1QFY17 operating performance was below our expectations. Sales declined 20% YoY to INR8.1b (our estimate: INR9.3b), EBITDA fell 19% YoY to INR637m (our estimate: INR937m), EBITDA margin remained stable YoY at 7.8% (our estimate: 10.0%) and net profit was down 19% YoY to INR452m (our estimate: INR627m). Consolidated revenue declined 19% YoY to INR10.0b, while net profit (post minority interest) was down 10% YoY to INR490m. Motilal Oswal also cut their rating from Neutral to Sell with a revised target price of INR730 (25x FY18E EPS of INR29, based on last 10 years’ average P/E multiple), given the weak business outlook and rich valuations.