Buy Dilip Buildcon; target of Rs 1227: Axis Direct
Axis Direct’s research report on Dilip Buildcon
Dilip Buildcon’s (DBL) Q2FY18 sales grew 73% YoY at Rs 15.8 bn, ahead of our estimate of Rs 14.7 bn and consensus estimate of Rs 13.8 bn. EBITDA was up 84% YoY at Rs 2.9 bn and 14% above our estimate. EBITDA margin was up ~100 bps YoY at 18%. PAT came in at ~Rs 1.2 bn (~17x vs. Rs 70 mn YoY).
We increase our FY18E/19E EPS to Rs 46/ Rs 68 (vs. Rs 42/ Rs 51 earlier) given the strong execution in H1 and increased guidance for order inflow and revenue. We also raise our target multiple to 18x (15x earlier) on improved sector outlook on Bharatmala program, which provides growth visibility beyond FY19. Our revised TP stands at Rs 1,227 (18x FY19E EPS) vs. Rs 765 earlier.
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