Inox Wind |4QFY2019 Result Update
May 21, 2019
INOX Wind Ltd.
BUY
CMP
`60
Target Price
`100
Quarterly (` cr)
Q4FY19
Q4FY18
% yoy Q3FY19
% qoq
Investment Period
12 Months
Net sales
180
203
-12%
391
-54%
EBITDA
-28
-30
-5%
61
-146%
EBITDA margin (%)
-15.8%
-14.6%
-114
15.65%
-3142%
Stock Info
Adjusted PAT
-53.56
-55.62
-3.7%
1.67
-3307%
Sector
Capital Goods-Wind
Market Cap (` cr)
1,332
During the quarter under review (Q4FY2019), Inox Wind Ltd. (IWL) has reported de- growth
Beta
1.0
in revenue by 12% on yoy basis at `180cr from `203cr in the corresponding quarter
52 Week High / Low
153/55
Avg. Daily Volume
10,566
previous year. The de-growth in revenue was primarily on account of slow order execution
Face Value (`)
10
and delay of SECI-I & II orders commissioning. Further, an increase in raw material prices
BSE Sensex
39,353
Nifty
11,828
and fixed cost expenses dragged profitability at operating level resulting in loss of `28cr at
Reuters Code
INWN.BO
EBIDTA level. Thus, net loss widened to `53.56cr compared to profit of `1.67cr on
Bloomberg Code
INXW IN
sequential basis. For full year ended March 31, 2019, loss has narrowed down to `40cr vs.
loss of `180cr in the previous year.
Shareholding Pattern (%)
Currently, IWL has been left with net order book of 726 MW excluding LOI of 501 MW and
Promoters
75.0
23 MW from leading IPP.
MF / Banks / Indian Fls
0.8
Key things to watch out for FY2020 would be the ramp-up in execution of SECI-I & II order,
FII / NRIs / OCBs
7.3
which has already been delayed by many months now. However, in the beginning of
Indian Public / Others
16.9
FY2020, IWL has received grid connectivity ready for SECI-I commissioning, which will also
help to commission SECI-II order as well. Management has guided that SECI-I would be
Abs.(%)
3m
1yr
3yr
commissioned in Q1FY2020 itself, and expects to execute around 600 MW order during
Sensex
10.1
13.7
41.4
FY2020.
INOX Wind
(2.8)
(39.5)
(86.0)
During the year, IWL has supplied 264 MW and is left with net order book of 726 MW and
also signed agreement for its newly launched 3.3 MW turbine with leading IPP.
3 Years Performance charts
Outlook and Valuation: Considering the changing dynamics of renewable energy
500
consumption and government’s thrust to auction 10 GW wind capacity by year 2028, we are
bullish on the sector, and hence, have a positive outlook on IWL. At the CMP of `60, the
400
stock is available at PE multiple of 5.5x its FY2021E EPS of `11. We recommend a BUY on
300
stock and assign a multiple of 9x to arrive at a target price of `100, implying a potential
200
upside of 66%.
100
Key Financials
0
Y/E March (` cr)
FY17
FY18
FY19
FY20E
FY21E
Net Sales
3,415
480
1,437
3,416
3,306
% chg
(23)
(86)
200
138
(3)
Source: Capitaline Angel Research
Net Profit
303
(188)
(40)
295
244
% chg
(34)
(162)
(79)
(837)
(17)
EBITDA (%)
16.4%
-17.0%
10.9%
15.0%
14.3%
Kripashankar Maurya
EPS (Rs)
14
(8)
(2)
13
11
022 39357600, Extn: 6004
P/E (x)
4
(7)
(33)
4.5
5.5
P/BV (x)
0.6
0.7
0.7
0.6
0.5
RoE (%)
13.9
(9.4)
(2.0)
13.0
9.8
RoCE (%)
13.9
(4.7)
2.9
13.5
11.4
EV/EBITDA
3.8
(20.5)
12.0
2.0
1.4
May 21, 2019
1
Inox Wind |4QFY2019 Result Update
Exhibit 1: Q4FY19 Performance
In INR Cr
Q4FY19 Q4FY18 Q3FY19YOY %
QOQ%
Net Sales
180
203
391
-12%
-54%
Total Income
180
203
391
-12%
-54%
Total Expenditure
208
233
330
-11%
-37%
Raw Material Consumed
91
15
250
514%
-64%
Stock Adjustment
-19
50
-24
NA
NA
Purchase of Finished Goods
0
0
0
NA
NA
COGS
72
65
225
10%
-68%
(Profit)/ Loss on Forex Transaction
0.3
4
-10
Employee Expenses
25
23
22
11%
12%
EPC,O&M, and common Infra Facility expenses
74
69
41
NA
82%
Other Expenses
37
72
51
-49%
-28%
As a % of sales
Raw Material Consumed
51%
7%
64%
Stock Adjustment
-11%
25%
-6%
Purchase of Finished Goods
0%
0%
0%
COGS
40%
32%
90%
Gross Margin %
60%
68%
42%
(Profit)/ Loss on Forex Transaction
0%
2%
-3%
Employee Expenses
14%
11%
9%
Other Expenses
21%
35%
20%
EBITDA
-28
-30
61
-5%
-146%
Other Income
4.59
2.2
3.7
106%
25%
Interest
44.69
43.7
45.4
2%
-2%
PBDT
-68.41
-71.21
19.39
NA
-453%
Depreciation
16.98
12
16
39%
5%
Share of Profit/(Loss) Associates
-0.02
0.02
0
PBT
-85.41
-83.44
2.72
NA
-3240%
Tax
-31.85
-28
1.05
NA
NA
PAT
-53.56
-55.62
1.67
NA
NA
Ratios
BPS BPS
EBITDA margin (%)
-16%
-15%
16%
-114
NA
PAT margin %
-30%
-27%
0%
-249
-3026
Tax rate %
NA
NA
39%
NA
-NA
Source: Company, Angel Research
Valuation
Outlook and Valuation: Considering the changing
dynamics
of renewable energy
consumption and government’s thrust to auction 10 GW wind capacity by year 2028, we are
bullish on the sector, and hence, have a positive outlook on IWL. At the CMP of `60, the
stock is available at PE multiple of 5.5x its FY2021E EPS of `11. We recommend a BUY on
stock and assign a multiple of 9x to arrive at a target price of `100, implying a potential
upside of 66%.
May 21, 2019
2
Inox Wind |4QFY2019 Result Update
Risks to our estimates
Delay in auction
Any delay in auction of wind energy may leads to slowdown in sector hence create an
uncertainty in revenue visibility.
Income statement
Y/E March (` cr)
FY17
FY18
FY19
FY20E
FY21E
Total operating income
3,415
480
1,437
3,416
3,306
% chg
(23)
(86)
200
138
(3)
Total Expenditure
2,855
561
1,281
2,903
2,833
Raw Material
1,920
47
883
2,118
2,050
Personnel
117
100
94
68
66
Loss on Forex Transaction
-19
-1
-7
-
1
Others Expenses
836
416
311
717
716
EBITDA
560
-81
156
512
473
% chg
(21)
(115)
(292)
228
(8)
(% of Net Sales)
16.4%
-17.0%
10.9%
15.0%
14.3%
Depreciation& Amortisation
44
52
66
59
63
EBIT
517
-134
90
453
409
% chg
(24)
(126)
(167)
404
(10)
(% of Net Sales)
15
-28
6
13
12
Interest & other Charges
155
171
169
73
99
Other Income
65
24
17
18
20
Extraordinary Items
-
-
Recurring PBT
427
-280
-62
398
330
% chg
(34)
(166)
(78)
(741)
(17)
Tax
124
-93
-22
103
86
PAT (reported)
303
-188
-40
295
244
% chg
(34)
(162)
(79)
(837)
(17)
(% of Net Sales)
8.9
-39.1
-2.8
8.6
7.4
Basic & Fully Diluted EPS (Rs)
14
-8
-2
13
11
% chg
(34)
(162)
(79)
(837)
(17)
Source: Company, Angel Research
May 21, 2019
3
Inox Wind |4QFY2019 Result Update
Balance Sheet
Y/E March (`cr)
FY17
FY18
FY19
FY20E FY21E
SOURCES OF FUNDS
Equity Share Capital
221.9
221.9
221.9
221.9
221.9
Reserves& Surplus
1,968
1,782
1,743
2,038
2,282
Shareholders Funds
2,190
2,004
1,965
2,259
2,504
Total Loans
1,528
831
1,092
1,092
1,092
Other Liabilities
113
33
69
69
69
Total Liabilities
3831
2868
3125
3420
3664
APPLICATION OF FUNDS
Net Block
765
985
973
1,098
1,130
Capital Work-in-Progress
112
20
66
66
66
Investments
53
0
69
-
-
Long Term Loans & Advances
16
15
13
13
13
Current Assets
3,938
2,708
3,076
3,124
3,310
Inventories
690
929
944
655
634
Sundry Debtors
2,382
1,339
1,630
1,029
906
Cash
437
127
135
964
1,316
Loans & Advances
87
0
1
1
1
Investments & Others
341
313
366
475
453
Current liabilities
1,324
1,230
1,616
1,448
1,421
Net Current Assets
2,614
1,478
1,460
1,677
1,889
Other Non Current Asset
270
371
544
566
566
Total Assets
3831
2868
3125
3420
3664
Source: Company, Angel Research
Cash flow
Y/E March (`cr)
FY17
FY18
FY19E
FY20E
FY21E
Profit before tax
427
(280)
(62)
398
330
Depreciation
44
52
66
59
63
Change in Working Capital
(436)
(669)
231
(422)
339
Interest / Dividend (Net)
155
171
169
73
99
Direct taxes paid
124
(93)
(22)
103
86
Others
(200)
1,088
(79)
870
(212)
Cash Flow from Operations
114
269
302
1,082
706
(Inc.)/ Dec. in Fixed Assets
(290)
(186)
(272)
(99)
(106)
(Inc.)/ Dec. in Investments
(111)
302
(69)
69
-
Cash Flow from Investing
(5)
332
(341)
(30)
(106)
Issue of Equity
-
-
-
-
-
Inc./(Dec.) in loans
90
-697
261
-
-
Others
(71)
(63)
(37)
(223)
(247)
Cash Flow from Financing
19
(760)
224
(223)
(247)
Inc./(Dec.) in Cash
128
(159)
185
829
352
Opening Cash balances
76
204
46
135
964
Closing Cash balances
204
46
135
964
1,316
Source: Company, Angel Research
May 21, 2019
4
Inox Wind |4QFY2019 Result Update
Key Ratio
Y/E March
FY17 FY18 FY19E FY20E FY21E
P/E (on FDEPS)
4
-7
-33
5
5
P/CEPS
4
-10
51
4
4
P/BV
1
1
1
1
1
Dividend yield (%)
0
0
0
0
0
EV/EBITDA
4
-20
12
2
1
EV / Total Assets
4
3
3
2
0
Per Share Data (Rs)
EPS (Basic)
14
-8
-2
13
11
EPS (fully diluted)
14
-8
-2
13
11
Cash EPS
16
-6
1
16
14
DPS
0
0
0
0
0
Book Value
99
90
89
102
113
Returns (%)
ROCE
14
-5
3
14
11
Angel ROIC (Pre-tax)
16
-5
3
19
18
ROE
14
-9
-2
13
10
Turnover ratios (x)
Inventory / Sales (days)
74
707
150
70
70
Receivables (days)
255
1018
414
110
100
Payables (days)
104
408
226
50
50
Working capital cycle (ex-cash) (days)
225
1317
338
130
120
Source: Company, Angel Research
May 21, 2019
5
Inox Wind |4QFY2019 Result Update
Research Team Tel: 022 - 39357800
DISCLAIMER:
Angel Broking Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India Limited, Bombay Stock
Exchange Limited, Metropolitan Stock Exchange Limited, Multi Commodity Exchange of India Ltd and National Commodity & Derivatives
Exchange Ltd It is also registered as a Depository Participant with CDSL and Portfolio Manager and Investment Adviser with SEBI. It also has
registration with AMFI as a Mutual Fund Distributor. Angel Broking Limited is a registered entity with SEBI for Research Analyst in terms of SEBI
(Research Analyst) Regulations, 2014 vide registration number INH000000164. Angel or its associates has not been debarred/ suspended by
SEBI or any other regulatory authority for accessing /dealing in securities Market. Angel or its associates/analyst has not received any
compensation / managed or co-managed public offering of securities of the company covered by Analyst during the past twelve months.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision.
Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such
investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in
this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an
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Disclosure of Interest Statement
Inox wind
1. Financial interest of research analyst or Angel or his Associate or his relative
No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives
No
3. Served as an officer, director or employee of the company covered under Research
No
4. Broking relationship with company covered under Research
No
May 21, 2019
6
