GMM Pfaudler Expects Order Book To Jump 25% In 2019-20

GMM Pfaudler Ltd. expects this fiscal year’s order book to jump 25 percent year-on-year, aided by robust growth in its heavy engineering vertical, according to Managing Director Tarak Patel.

“We can at least say that this year’s backlog (order book) should be about 25 percent higher than what we started last year,” Patel told BloombergQuint, adding that the industrial equipment supplier expects its heavy engineering business to grow the most. “The market (for heavy engineering) is enormous. The Indian market is large but the international market is even larger.”

According to a research report by Anand Rathi, a pick up in large-scale heavy engineering orders is clear. “Higher realisations, lower commodity costs, greater operating leverage and more export orders in the third quarter expanded the Ebitda margin by around 360 basis points to 19.5 percent,” the report said.“The order book offers revenue assurance till Q2 FY21.”

The order book in the third quarter is one of the highest the company has ever seen, Patel said. “We aim to end this year with a strong fourth quarter. We believe that having a strong backlog in the first and second quarter next year will help us,” he said.

GMM Pfaudler’s Q3 Results: Key Highlights (YoY)

• Standalone revenue rose 29 percent to Rs 187 crore
• Ebitda soared 66 percent year-on-year to Rs 29 crore.
• Net profit rose 77 percent to Rs 19 crore.

Being a multinational that’s part of the Pfaudler’s global network, the company expects its Ebitda margin to grow for the next two years, Patel said.