PL First Cut – Praj Industries Q2FY24

PL First Cut – Praj Industries Q2FY24 – Amit Anwani – Research Analyst, Prabhudas Lilladher Pvt Ltd

Praj Industries Q2FY24- First Cut- Results below estimates on all fronts

Result Summary

✳️Praj reported consolidated revenue of Rs8.8bn, flat YoY (vs PLe ~Rs9.5bn and consensus estimates of Rs9.8bn), on back of continued execution of opening order book (Rs37.8bn as on Q1FY24).

✳️Gross margins came in at 43.4% vs 34.5% in Q2FY23 (low base), likely due to business mix and normalized commodities prices.

✳️EBITDA grew 20.2% YoY to Rs778mn (PLe ~Rs952mn and consensus estimate of Rs940mn), with EBITDA margin expanding by 147bps YoY to 8.8% (PLe of 10%), partly impacted due to higher employee cost (up 35.7% YoY) and other expenses (up 24.7%, YoY).

✳️PAT grew ~29.4% YoY to Rs623mn (vs PLe Rs702mn and consensus estimate of Rs728mn) aided by higher other income (up 87.1% to Rs171mn).

✳️The stock is currently trading at PE of 32.3x/28.4x FY24/25E. We have Accumulate rating on stock with TP of Rs618,