Sadbhav Engineering Ltd. share price target and research reports

Name: Latest research reports of Sadbhav Engineering Ltd. authored by HDFC Securities and published by - Trendlyne research reports.
Item: Sadbhav Engineering Ltd.
Rating: 5
Author: HDFC Securities

Latest analyst research reports with target prices and PDF download for SADBHAV, BSE:532710 Sadbhav Engineering Ltd.

Sadbhav Engineering Ltd.

19 Aug 2019, 08:52AM

10.76

-2.62%

Sadbhav Engineering (1QFY20): Deleveraging key trigger. Maintain BUY

Buy: Sadbhav Engineering Ltd.

Target

HDFC Securities

Contrary to investment wisdom SEL has corrected sharply when it is perceived to get significantly deleveraged over next 2-3months. Asset light model, selective focus on EPC projects bidding, ROFO on HAM assets, 10% stake in IndInfraVit (already SIPL is in the money) and potential resolution to bleeding Rohtak Panipat project are other key re-rating triggers. Merger may be another positive as combined entity curtails equity intensive projects and surplus cash is utilized towards pursuing growth, without equity dilution. SEL is in a sweet spot. CPPIB backing is literally a large bank support. We maintain BUY. Key risks (1) Delay in SIPL stake sale; (2) Slow order inflows; and (3) Further delay in appointed dates. We maintain BUY on SEL with a reduced TP of Rs 269/sh (vs. Rs 340 earlier). We value SELs EPC business at 15x FY21E EPS and assign a 20% hold co discount to SIPL stakes market value. Price cut is on account of FY20/21E EPS downgrade by 24.4/20.4%.

Promoters have decreased holdings from 36.22% to 25.52% in Sep 2025 qtr

Sadbhav Engineering Ltd.

19 Aug 2019, 12:00AM

10.76

-2.62%

Sadbhav Engineering

Hold: Sadbhav Engineering Ltd.

Recommendation Target

ICICI Securities Limited

Order book at | 10,809.7 crore as of Q1FY20 SEL's order book (OB) was at | 10,809.7 crore as of Q1FY20, implying an OB-to-bill ratio of 3.1x on TTM revenues.The management expects order inflows to the tune of | 3,000-4,000 crore in FY20E. On the execution front, the management expects to commence the Kim-Ankaleshwar project in Q2FY20E while the other three HAM projects with total EPC value of | 2,347 crore are expected to commence execution post Q2FY20E. Overall, the management has guided for revenue worth | 3,600 crore (including |350...

Sadbhav Engineering Ltd. is trading at high day volume of 521.1K.

Sadbhav Engineering Ltd.

16 Aug 2019

10.76

-2.62%

Sadbhav Engg

Buy: Sadbhav Engineering Ltd.

Target

Sharekhan

Sadbhav Engineering Limited (SEL) reported weak standalone earnings for Q1FY2020 owing to a delay in receipt of appointed dates for hybrid annuity model (HAM) projects, which dragged down revenue and net profit by 8% and 38% y-o-y, respectively. The management maintained a revenue guidance of Rs. 3,600 crore for FY2020 on back of better execution in H2FY2020 along with receipt of appointed dates for couple of projects at the start of H2FY2020. Post the transfer of nine assets in recently signed deal with the IndInfravit trust, the management is...

Promoters have decreased holdings from 36.22% to 25.52% in Sep 2025 qtr

Sadbhav Engineering Ltd.

01 Aug 2019

10.76

-2.62%

Focus on business is the only remedy

Buy: Sadbhav Engineering Ltd.

Recommendation Target

Motilal Oswal

Around 50% decline in stock price implies ~75% correction in EPC business valuation: Since the announcement of the asset sale a month back, SADE's stock price has corrected by ~50%. We note that the company draws ~45% of valuation (based on our SOTP methodology) on account of its stake in the listed subsidiary, Sadbhav Infrastructure Projects Limited. Thus, adjusted for...

Sadbhav Engineering Ltd. is trading below all available SMAs

Sadbhav Engineering Ltd.

03 Jul 2019

10.76

-2.62%

Sadbhav Engg

Buy: Sadbhav Engineering Ltd.

Sharekhan

Sadbhav Engineering Limited (SEL) entered into definitive agreement with IndInfravit Trust for a 100% stake sale in nine operational projects held under listed subsidiary Sadbhav Infrastructure Projects (SIPL). The assets sold at an EV of Rs. 6612 crore and equity value of Rs. 2550 crore valuing the assets at 1.7x book value and 8.4x EV/ EBITDA on FY2019 earnings. The equity value will be received as Rs. 1900 in cash and 10% stake in IndInfravit trust. The deal will aid in Rs. 4000 crore O&M; contract for SIPL, more than halving leverage...

Sadbhav Engineering Ltd. has lost -21.35% in the last 6 Months

Sadbhav Engineering Ltd.

03 Jul 2019

10.76

-2.62%

Sadbhav Engineering (Update): A new beginning. Maintain BUY

Buy: Sadbhav Engineering Ltd.

Target

HDFC Securities

SIPL's asset monetization brings in the much needed liquidity flush to the Sadbhav Group. The cash infusion will lead to SEL net D/E reducing from 0.7x to 0.2x (FY19/20E). Balance sheet strengthening makes a case of credit rating upgrade. With IndInfravit's backing, SIPL is well placed to bid for upcoming HAMs/BOTs and SEL in turn stands to benefit from captive ordering. We believe SEL is well placed to deliver 20.3/26.5% FY19-21E Rev/APAT CAGR. Maintain positive stance. We maintain BUY with a reduced SOTP of Rs 340/sh (vs Rs 353/sh earlier). We value SELs EPC business at 15x FY21E EPS and assign a 20% hold co discount to SIPL stakes market value. We have downgraded FY20/21E EPS by 1/2%.

Sadbhav Engineering Ltd. is trading at high day volume of 521.1K.

Sadbhav Engineering Ltd.

03 Jul 2019

10.76

-2.62%

Sadbhav Engineering: Company Update - Deal done

Hold: Sadbhav Engineering Ltd.

IDBI Capital

Sadbhav Infrastructure Projects Ltd (SIPL), a subsidiary of Sadbhav Engineering Ltd (SEL) has entered in to a definitive agreement with Indiainfravit Trust to sell its 100% stake in nine operational road assets. The transaction values its road portfolio at Rs66.1bn which includes Rs25.5bn of equity and Rs40.6bn of debt. The deal will result in massive reduction in debt at SIPL level and advances given to SIPL by SEL worth Rs5.5bn are likely to be repaid. Moreover, out of the nine projects, in one projects viz. Mysore-Bellary, SEL has invested equity to the tune of 74% which will yield close to Rs1bn to SEL. We view this development positive for both SIPL as well SEL as it will lead to leaner balance sheet paving the way for...

Promoters unpledged 37.78% of shares in last quarter. Total pledge stands at 42.67% of promoter holdings

Sadbhav Engineering Ltd.

03 Jul 2019

10.76

-2.62%

First Light: Sadbhav Engineering

Buy: Sadbhav Engineering Ltd.

BOB Capital Markets Ltd.

Sadbhav Infrastructure Projects (SIPL), a 69.6% subsidiary of Sadbhav Engineering (SADE), has concluded its 100% stake sale in nine operational road assets to IndInfravit Trust at an EV of Rs 66.1bn. The equity value of the deal stands at Rs 25.5bn (~1.7x invested capital) to be paid out in two parts: Rs 19bn in cash and the balance as 10% of units in IndInfravit Trust. Divestment will help deleverage SADE's consolidated balance sheet and give SIPL access to capital for funding existing and new projects....

Promoters unpledged 37.78% of shares in last quarter. Total pledge stands at 42.67% of promoter holdings

Sadbhav Engineering Ltd.

03 Jul 2019

10.76

-2.62%

Sadbhav Engineering

Buy: Sadbhav Engineering Ltd.

Target

ICICI Securities Limited

Structure of the deal and proceeds from the transaction On July 1, 2019, Sadbhav Infrastructure Project Ltd. (SIPL), a subsidiary of Sadbhav Engineering Ltd. (SEL), and IndInfravit Trust executed definitive agreements wherein the latter has agreed to purchase SIPL's 9 (out of 12) operational road projects at an enterprise value (EV) of | 6,611.2 crore. Equity valuation of these nine assets is | 2,550 crore, implying 1.7x P/BV (SIPL's initial investment in these 9 assets: | 1,550 crore). SIPL will receive | 2,550 crore equity in form of | 1,900 crore cash & | 650 crore (10%)...

Sadbhav Engineering Ltd. has lost -21.35% in the last 6 Months

Sadbhav Engineering Ltd.

02 Jul 2019

10.76

-2.62%

Sadbhav Engineering (BUY): Stake sale complete focus shifts to execution

Buy: Sadbhav Engineering Ltd.

BOB Capital Markets Ltd.

Stake sale complete focus shifts to execution Sadbhav Infrastructure Projects (SIPL), a 69.6% subsidiary of Sadbhav Engineering (SADE), has concluded its 100% stake sale in nine operational road assets to IndInfravit Trust at an EV of Rs 66.1bn. The equity value of the deal stands at Rs 25.5bn (~1.7x invested capital) to be paid out in two parts: Rs 19bn in cash and the balance as 10% of units in IndInfravit Trust. Divestment will help deleverage SADE's consolidated balance sheet and give...

Promoters have decreased holdings from 36.22% to 25.52% in Sep 2025 qtr

Is Sadbhav Engineering Ltd. worth buying?

408 Votes:

Buy 78.92%

Sell 12.01%

Hold 9.07%

Near 52W Low of ₹10.54

High volume today

Sadbhav Engineering Ltd. share price target and research reports

Latest analyst research reports with target prices and PDF download for SADBHAV, BSE:532710 Sadbhav Engineering Ltd.