LMW Ltd. share price target

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%.

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.