Dolphin Offshore Enterprises (India)'s (Dolphin's) Q1FY14 consolidated results were above CRISIL Research's expectations led by faster-than-expected execution of EPC orders and forex gains. Consolidated revenues increased 55 percent y-o-y to Rs 1,304 mn driven by strong y-o-y growth in both EPC and marine services businesses. EBITDA margin increased 593 bps y-o-y to 32.5 percent driven by higher contribution from the high-margin marine services business. Consolidated net profit increased 185 percent y-o-y to Rs 304 mn. The company reported forex gain of Rs 187 mn (Rs 35 mn realised gain on foreign currency income, Rs 140 mn notional gain translation and Rs 80 mn on remittance of rupee loan by subsidiary to the parent). While the EPC business continues to face challenges, the renewal of charters in the marine business improves visibility. We maintain our fundamental grade of 2/5, however, the development on the EPC business is a key monitorable.
Low visibility on the EPC business
The EPC business, which constituted 81.9 percent of revenues and 39.2 percent of EBITDA in FY13, is facing challenging market conditions. The management has indicated that intense competition in this space is a key concern and Dolphin plans to bid only for the remunerative projects. The outstanding order book of Rs 580 mn in the EPC business will be executed mostly in Q3-Q4FY14 (Q2 is a lean season due to monsoons) and, hence, the outlook for FY15 is bleak.
Marine services to support EBITDA in FY14
The high-margin marine services business accounts for nearly 60 percent of consolidated EBITDA. The company had placed its anchor handling tug and construction barge on a bare-boat charter from October 2012 until October 2013. The charter has now been extended by the client by one year until October 2014. This charter generates about 95 percent+ of the marine services revenues and EBITDA. Further, its workboat-cum-supply vessel and tug have received new contracts until Q1FY15 and Q3FY16 respectively.
No resolution yet on the long-outstanding debtors
Dolphin's standalone debtors declined from Rs 2,106 mn in FY13-end to Rs 1,868 mn. However there is no resolution on Rs 891 mn of debtors from three large projects which are outstanding for more than a year. We have factored in Rs 465 mn of write-offs in FY14.
Fair value lowered
We have lowered our revenues and earning estimates. We also lower our P/Bv multiple from 0.6x to 0.5x due to muted visibility post FY14. Our fair value is revised from Rs 91per share to Rs 77 per share.
Disclaimer: This report (Report) has been commissioned by the Company/Investor/Exchange and prepared by CRISIL. The report is based on data publicly available or from sources considered reliable by CRISIL (Data). However, CRISIL does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. Opinions expressed herein are CRISIL's opinions as on the date of this Report. The Data / Report are subject to change without any prior notice. Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The Report is not a recommendation to buy / sell or hold any securities of the Company. CRISIL especially states that it has no financial liability, whatsoever, to the subscribers / users of this Report. This Report is for the personal information of the authorized recipient only. This Report should not be reproduced or redistributed or communicated directly or indirectly in any form to any other person or published or copied in whole or in part especially outside India, for any purpose.
CRISIL Limited . All Rights Reserved. Published under permission from CRISIL"
Anda sedang membaca artikel tentang
CRISIL revises Dolphin Offshore`s fair value to Rs 77
Dengan url
http://harmonisem.blogspot.com/2013/08/crisil-revises-dolphin-offshores-fair.html?m=0
Anda boleh menyebar luaskannya atau mengcopy paste-nya
CRISIL revises Dolphin Offshore`s fair value to Rs 77
namun jangan lupa untuk meletakkan link
CRISIL revises Dolphin Offshore`s fair value to Rs 77
sebagai sumbernya
0 komentar:
Posting Komentar