PSP Projects Ltd. share price target

We value the company at 10.5x FY24E EPS to arrive at the TP of Rs 660/share, implying an upside potential of 13% from the current levels.

We value the company at 10.5x FY24E EPS to arrive at the TP of Rs 660 /share, implying an upside potential of 10% from the current levels.

We value the company at 10.5x FY24E EPS to arrive at the target price of Rs 665/share, implying an upside potential of 26% from the current levels.

We value the company at 10.5x FY24E EPS to arrive at the target price of Rs 665/share, implying an upside potential of 28% from the current.

Strong execution and robust bid pipeline

We recommend a Buy the stock for a target price of Rs 620/ implying an upside of 11% from CMP

We initiate coverage with a BUY rating and value the company 10.5x FY24E EPS to arrive at a target price of Rs 620/share. TP implies an upside potential of 28% from the CMP.

Strong execution with healthy margin

Good resilience in challenging environment

Despite headwinds, performance impressive

PSP Projetcs (PSP) over the last two days announced order wins (including L1) worth ~INR 2,500 cr.

PSP Projetcs (PSP) reported healthy recovery in revenue and profitability in Q3FY21 due to near normal operations at sites, but performance still fell short of our expectations.

Surat Diamond project (SDB) revenues were soft in Q2 FY21 due to low labor availability(whichimprovedonlyinAugust).SDBrevenuesareexpectedtopick upfromQ3FY21onwards.TheQ2FY21monthlyexecutionrateofRs.220mnis expectedtoriseto500600mnonmonthlybasisinQ3forSDB.TheCompany...

Revenue increased by 43.6% YoY in FY20 to Rs15 bn vs. Rs10.4 bn in FY19. SDB's revenue too increased by 52.7% YoY in FY20 to Rs5.4 bn (36.2% of revenue) vs. Rs3.55 bn (34% of revenue) in FY19. EBITDA margins down 153 bps YoY to 12.7% in FY20 vs. 14.3% in FY19. Reported PAT increased by 43.2% YoY in FY20 to Rs1.29 bn vs. Rs902 mn in FY19. PSP received order inflow of Rs15.8 bn in FY20 vs. Rs14.15 bn in FY19, a growth of 11.5% YoY. PSP's orderbook as on Jun'20 stands at Rs29.6 bn and is L1 in GIDC project worth Rs2.75 bn. Including the same, orderbook stands at Rs32.35 bn...

PSP Projects Ltd (PSP) reported its Q1FY21 numbers. Delay in execution due to lockdown and lack of manpower availability impacted the performance.

PSP Projects Ltd (PSP) reported better than expected numbers in a quarter which was impacted by lack of labour availablity and lockdown.

PSP delivered robust 3QFY20 performance led by SDB project execution. Base business run-rate ex-SDB of Rs 2.3bn/qtr needs to ramp up to provide growth visibility beyond FY21E as SDB will get completed by Dec-20E. New order wins augur well for growth. Recent award outside Gujarat of Rs 3.4bn in Varanasi is directionally well placed for de-risking Gujarat exposure. We remain cautious on rising share of Govt order in mix. These projects come with interest bearing advances and large BG requirement. Besides PSP needs to arrange 25% cash margin for availing BG's. We maintain BUY. Key risks (1) Delay in diversification outside Gujarat; (2) Delays in new order conversion & (3) Further delay in SDB Project execution. PSP delivered Rev/EBIDTA/APAT beat of 43/32/25% on back of robust execution in SDB project. We maintain BUY with an increased TP Rs 607/sh TP vs Rs 590/sh earlier (we value EPC business at 15x FY21E EPS vs 16x earlier). We have increased our FY20E/FY21E EPS estimates by 7/3%.

PSP Projects Ltd (PSP), reported a robust set of numbers that exceeded our expectations.