Buy Thermax, target price Rs 2445: ICICI Direct

ICICI Direct has buy call on Thermax with a target price of Rs 2445. The current market price of Thermax Ltd. is Rs 1992.7. Time period given by analyst is one year when Thermax Ltd. price can reach defined target.

Thermax Ltd., incorporated in the year 1980, is a Mid Cap company (having a market cap of Rs 23704.36 Crore) operating in Engineering sector.

Thermax Ltd. key Products/Revenue Segments include Sale of services, Other Operating Revenue, Scrap, Export Incentives, Royalty Income and Commission for the year ending 31-Mar-2021.



Financials
For the quarter ended 31-12-2021, the company reported a Consolidated Total Income of Rs 1643.90 Crore, up 9.15 % from last quarter Total Income of Rs 1506.07 Crore and up 14.25 % from last year same quarter Total Income of Rs 1438.82 Crore. Company reported net profit after tax of Rs 79.45 Crore in latest quarter.

Investment Rationale
For Q4FY22E, Thermax announced order inflows worth ~ Rs 1176 crore, as on date for the quarter. In terms of financial performance, it expects revenues to grow 16.3% to Rs 1830.7 crore on the back of decent order wins in the past few quarters. It expects EBITDA at Rs 131.8 crore with EBITDA margins at 7.2%, factoring in execution of some legacy low cost orders and commodity price impact. Adjusted PAT is expected at Rs 102.6 crore, down 4.4% YoY partly aided by other income

Promoter/FII Holdings
Promoters held 61.98 per cent stake in the company as of 31-Dec-2021, while FIIs owned 14.58 per cent, DIIs 12.73 per cent.