Feb 9, 2011

Punj Lloyds Q3FY11E Result update: Be and make

 PunjLloyd’s another poor quarter: Revenues of Punj Lloyd for Q3FY11 declined by 28% on consolidated basis as against same period last year. This was lower than expectation of Rs 26.30 billion on consolidated basis for Q3FY11. Operating margins have declined sharply on a sequential as well as yearly basis and stood at 3.4% for Q3FY11. Company posted losses due to lower than expected revenue growth, decline in margins as well as higher depreciation and interest charges.

Conclusion: Punj Lloyd came with another dismal quarter; the term disaster is the better word for this time. All the people like investors, analysts, brokerage houses, DII&FIIs of Punj Lloyd eagerly waiting for the quarterly results of Punj Lloyd. As per the management guidance and some hopes after the Q2 that “worst is behind it”. Punj Lloyd again came with bad set of numbers! The most worrying in this quarter is the top line and margins. In my view, one should avoid this stock till it delivers something positive rather than anticipating a good quarter. We can not expect where it should bottom out, now the big worrying factor is that ‘lack of confidence’ by all groups of investors. The share-price estimate of the engineering and construction company was cut to 69 rupees per shares from 99 rupees at BNP Paribas SA. More and More downgrades will come and newer lows expected in this stock.

With thanks
Be and make


Anonymous said...

It would be best to stay away from the stock for a quarter or two.

Be and Make said...

Dear EA - Yes, it is a very valid point.

With thanks
be and make