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Motilal Oswal: Engineers India Q1 Review - Normalcy To Return Gradually

Engineers India’s depleting order book remains a concern, amid superior execution and fewer new orders, Motilal Oswal says.

Transportation of Regasified Liquid Natural Gas pipelines at Dabhol-Bangalore-Goa For GAIL India project by Engineers India Ltd. (image Company website)
Transportation of Regasified Liquid Natural Gas pipelines at Dabhol-Bangalore-Goa For GAIL India project by Engineers India Ltd. (image Company website)

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Motilal Oswal Report

Engineers India Ltd.’s revenues were 14% higher than estimated; however, the lack of operating leverage led to a 16% miss in Ebitda.

Margins in consultancy projects were weak at 14.3% versus 39.3% in Q1 FY20. Order inflows plunged 91% YoY to Rs 810 million, with another Rs 160 million worth of orders received thus far.

Order inflows were primarily from the Hydrocarbon segment. The order book (OB) declined 20% YoY to Rs 91.2 billion, with order book/revenue at 3.1 times, the lowest in last four years.

With superior execution and lower order inflows, a depleting order book remains a concern, although it is not alarming at this stage.

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Motilal Oswal Engineers India Q1Fy21 Result Update.pdf

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