Improvement in Margins: LMW revenues were up by 19.4% YoY on the back of strong performance from boththe segments MTD (40.4%) and TMD (16.0%).

MTD Segment to be the Growth Driver: LMW revenues were up by 34.7% YoY on the back of strong performance from both the segments MTD (27.5%) and TMD (54.5%). The EBITDA margins have shown an improvement of 68 bps to reach 11.7% in Q2FY19. The major driver for margins was the improvement in EBIT margins of MTD segment by 176 bps.

Subdued Performance in TMD segment: LMW revenues decline by 8.6% YoY (12% below our expectations) due to the underperformance of Textile Machinery division by 20.6% YoY. EBITDA margin came in at 8.9% showing a decline of 122 bps YoY.

TMD Segment to Recover Gradually: LMW revenue grew by 10.1% YoY on the back of good numbers from machinery and foundry division. The textile machine division degrew by 33% due to lower orders from textile players.

Healthy Performance in Q2FY18; Strong Prospects GoingForward : Lakshmi Machine Works has delivered a decent performance in H1FY18 with double digit growth in revenue, EBITDA and PAT. In H1FY18, the revenue/EBITDA/ PAT have grown respectively by 11.5% /38.7% /65.3% YoY.

Muted Q3FY17; Healthy Balance Sheet Offers Strength to Grow:Lakshmi machine works has delivered a disappointing performance in Q3FY17 with double digit decline in revenue and EBITDA. The revenue/EBITDA/PAT have declined by 14.1%/28.4%/18.6% YoY. The company's EBITDA marginshave fallen by 191 bps YoY due to increase in operating expenditure.

Performance in Textile Machinery Segment Led to YoY De-growth: Lakshmi machine works has de-grown in Q2FY17 with double digit decline in revenue numbers and absolute EBITDA numbers on YoY basis. The revenue/ EBITDA/ PAT have declined by 13.8%/28.7%/18.4% YoY. The companys EBITDAmargins have fallen by 185 bps YoY due to increase in operating expenditure. Revenue has taken a dip due to low performance of Textile Machinery departmentsegment which has degrown by 20.5%.

Lakshmi Machine Works' (LMW) financial performance for 1QFY17 was below our expectations on revenue/PAT growth as well as margins. We recently had an interaction with the management and came to know that revenues worth Rs800mn-Rs1bn of textile machinery division (TMD) stand deferred to 2QFY17 on account of the delay in clients (spinning mills) getting their loans approved by banks. The revenue deferment led to 15% YoY decline in TMD revenues in 1QFY17. However, bank approvals for loans (of clients) are now in place and orders are likely to be executed in 2QFY17. Hence, we believe that this is more of a time difference in recognising revenues and do not see any impact on our annual...

Lakshmi Machine Works' (LMW) 4QFY16 performance was broadly in line with our expectations. Strong revenue growth was led by higher exports in 4QFY16 and some recovery in domestic market for textile machinery division (TMD). Revenues increased 5.6% YoY to Rs6,926mn (our estimate Rs6,767mn). EBITDA jumped 21% YoY to Rs890mn (our estimate Rs850mn). EBITDA margin witnessed an expansion of 170bps YoY to 12.9% (our estimate 12.6%) on account of 353bps YoY expansion in gross margin. However, PAT registered YoY decline of 16.6% to Rs561mn (our estimate Rs545mn). The decline in PAT was on account of YoY jump in the tax rate from 11% to...

LMW is one among the top three players across the world; commanding a 70%volume market share and 60% value market share in India. LMW has manyadvantages like cost competitive product, strong sales network, huge customerbase and perfect product mix with updated technology.

Lakshmi Machine Works (LMW) enjoys a dominant market share of around 60% in the Rs35bn domestic textile spinning machinery market and around 9% in the global US$3.5bn textile spinning machinery market. The domestic textile spinning machinery industry posted a CAGR of 10% over FY10-FY14. LMW's textile machinery division's revenue clocked a CAGR of 18% over the same period. However, subdued demand in FY15 pulled down its CAGR to 16% over FY10-FY15. Textile spinning machinery exports from India clocked a CAGR of 39% over FY10FY14. LMW outperformed the industry by registering a CAGR of 81% in textile spinning machinery over the same period. However, the company reported a tepid...

Lakshmi Machine Works (LMW) reported 1QFY16 numbers that were largely in line with our estimates. The company witnessed only a marginal YoY decline in revenue and flat EBITDA margin, mainly driven by expansion in gross margin and slightly lower depreciation but a huge jump in tax rate which resulted in a YoY decline in net profit along with margin compression. Total net revenue witnessed a decline of 1.3% YoY, mainly on account of a 3.8% fall in textile machinery division (TMD) which accounted for 89% of revenue at Rs5,069mn (our estimate was Rs4,715mn). EBITDA margin remained flat YoY at 11.6% (our estimate was 11.2%), mainly because of a 269bps YoY...

Margin Expansion Compensates For Muted Revenue Growth Lakshmi Machine Works (LMW) reported meager revenue growth, huge expansion in EBITDA margin, lower tax outgo (because of tax credit of Rs65mn), lower depreciation and a resultant substantial jump in bottom-line for 4QFY15. Total net revenue at Rs6.56bn grew at a muted rate of 3.5% YoY against our estimate of Rs7.18bn. The deviation was on account of lower-than-expected revenue from textile machinery division (TMD). However, we are positively surprised as LMW registered highest-ever fourth quarter EBITDA margin since FY12 of 11.2%, an expansion of 304bps YoY...

Lakshmi Machine Works (LMW), the largest player in domestic spinning machinery manufacturing industry, is determined to protect its current revenue market share of 60% in a cyclical, high-entry barrier, patented technology-driven, oligopolistic industry. It has strong client relationships along with sound corporate governance, ethical and transparent business practices. Long-term outlook for LMW is encouraging as India is expected to add 7mn-8mn spindles over FY14-FY19E, which provides a Rs105bn opportunity We expect LMW to clock a PAT CAGR of 15.6% with EBITDA margin/RoIC expansion of 85bps/1091bps to 12.5%/36.1%, respectively over...