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Punj Lloyd

Result Update: Punj Lloyd.

Revenues of Punj Lloyd for Q1FY12 reported a growth of 40% on consolidated basis as against same period last year. This was better than market expectation and led by improved execution. Operating margins witness an improvement on sequential and yearly basis and stayed at 7.4%.Company's profitability was impacted by increase in interest outgo which resulted in net loss for Q1FY12.

At current price of Rs 56, stock is trading at 8.5x P/E and 7.0x EV/EBITDA for FY12 respectively. For FY12,higher interest rates may continue to impact overall performance of the company. Due to high working capital requirements of the company coupled with high interest rates, the stock is expected to under-perform from these levels.