Ramky Infra IPO

IPO Note | Infrastructure

Ramky Infrastructure SUBSCRIBE
Issue Open: September 21, 2010
Subscribe with long term view Issue close: September 23, 2010

Rationale for our Subscribe view
Issu e Details
Diversified player: Ramky Infra (Ramky) is currently one of the most diversified Face Value: Rs10
players in India in the infra space with a presence across six segments. Over the Present Eq. Paid up Capital: Rs49.4cr
years, the company has forayed into new segments increasing its array of Offer Size: 1.13cr-1.31cr Shares*
services. On account of being a diversified player, we expect Ramky to maintain Post Eq. Paid up Capital*: Rs60.7cr - Rs62.5cr
its growth trajectory even if any particular segment/region faces slow down. Issue size (amount): Rs530cr
Price Band: Rs405-468
Present in niche segments: Ramky is a leader in the niche segment of construction
Promoters holding Pre-Issue: 84.1%
of water and waste-water plants. The segment currently has few players owing to
Promoters holding Post-Issue: 60.6% - 63.2%
which Ramky’s experience and expertise in the planning, designing and
Note:*at Upper and Lowerprice band respectively
construction of water and waste-water infrastructure projects gives it an edge
while bidding for new projects. Going ahead as well, we expect water and
Book Bu ilding
waste-water projects to continue to bolster the company’s order book. Moreover,
QIBs At least 60%
this high-margin segment helps the company in maintaining its margins in line
Non-Institutional At least 10%
with peers in spite of high subcontracting.
Retail At least 30%
Robust Order Book: Ramky’s robust order book of Rs7,432cr (3.7x FY2010
revenues) ensures revenue visibility over the next few years. The company has Post Issu e Shareholding Pattern
increased its order book at a CAGR of 49.4% over FY2007-10. We expect this Promoters Group 63.2%
trend to continue with the company already bagging orders worth Rs3,147cr as of MF/Banks/Indian
1QFY2011, which is >90% of last year’s order inflow. FIs/FIIs/Public & Others 36.8%

Outlook and Valuation: We believe that the company’s development business
including its BOT/BOOT project portfolio has a sustainable revenue stream –
management has guided 40% revenue contribution from the development
business going ahead. On a standalone basis, over FY2010-12, we expect Ramky
to post CAGR of 31.7% and 28.9% in top-line and bottom-line respectively, owing
to: 1) strong order book at 3.7x FY2010 revenues, 2) presence in growing
segments which ensures consistent order inflow, and 3) judicious choice of
projects wherein stable margins are ensured.

We have arrived at a SOTP Target Price of Rs495 for Ramky wherein we have
assigned a P/E of 14x FY2012E EPS fetching Rs426/share for its standalone
C&EPC business in line with peers like IVRCL and NCC. We have valued Ramky’s
investments in assets at 1.5x equity fetching Rs69/share, which is at a discount to
asset owners like IRB and ITNL. However, our SOTP Target Price provides limited
upside of ~6% from the upper price band. Nonetheless, we recommend a
Subscribe view on the issue, as we believe that the company is well- poised to
grow over the long term with the catalysts in place, viz. the company’s unique Shailesh Kanani
assets, which would give returns in years to come. Currently, with these assets at +91 22 -4040 3800 Ext: 321
different stages it is difficult to assign a value to them. shailesh.kanani@angeltrade.com

Key risks to our recommendation include: 1) Dependence on third party Nitin Arora
+91 22 -4040 3800 Ext: 314
contractors, 2) Order book includes orders pending financial closure/slow moving
nitin.arora@angeltrade.com
projects, and 3) Ramky claims Section 80IA benefits. However, we have assumed
full tax rates going ahead.

Please refer to important disclosures at the end of this report 1

Ramky Infra | IPO Note

Company Background

Ramky operates in the principal Ramky is the flagship of the Ramky Group, which is involved in services pertaining
business segments of construction and to waste management, environmental consulting, finance and accounting, data
developer
management, indirect procurement, real estate development, pharmaceuticals and
emerging technologies through its other group companies.

Ramky is an integrated construction and infrastructure development company.
Commencing business in 1994, it has participated in a diverse range of
construction and infrastructure projects in sectors including water and waste water,
transportation, irrigation, industrial parks (including SEZs), power transmission and
distribution, residential, commercial and retail property. Ramky’s pan-India
presence allows it to service the growing infrastructure needs throughout the
country.

Ramky operates in two principal business segments: (i) Construction business -
operated by Ramky, and (ii) Developer business - operated through 10 subsidiaries
and four associates. A majority of development projects are public private
partnerships and are operated by separate special purpose vehicles (SPV’s)
promoted by Ramky and the government.

In construction, Ramky undertakes projects in the following sectors:

Water and waste water projects such as water treatment plants, water
transmission and distribution systems, elevated reservoirs and ground level
service reservoirs, sewage treatment plants, common effluent treatment plants,
tertiary treatment plants, underground drainage systems and lake restorations.
Irrigation projects such as cross-drainage works, lift irrigation projects and
dams and barrages.
Industrial construction projects such as industrial parks, SEZs and related
works.
Transportation projects such as expressways, highways, bridges, flyovers and
dedicated service corridors
Building construction, which includes commercial, residential, public,
institutional and corporate buildings, mass housing projects and related
infrastructure and facilities such as hospitals and shopping malls.
Power transmission and distribution projects such as electricity transmission
networks, substation feeder lines and low tension distribution lines.

September 20, 2010 2


Exhibit 1: Group Structure

Source: Company, Angel Research



Issue Details

Ramky is tapping the IPO market with an issue size of Rs530cr (Rs 350cr through
fresh equity issue, and balance Rs 180cr through an offer for sale) and a price
band of Rs405-468 per equity share, thus resulting in a public issue of 1.1cr and
1.3cr equity shares of face value Rs10, resulting in a promoter shareholding
dilution of 21% and 24% at the upper and lower price band, respectively. The
company plans to use the IPO proceeds for investment in capital equipments,
working capital requirements and repayment of loans.

Exhibit 2: Objects of the Issue
Particulars Amount (Rs cr)
Investment in capital equipment 80.5
Working Capital requirements 175.0
Repayment of loans 25.0
General Corporate Purpose -
Total 350
Source: RHP, Angel Research

Exhibit 3: Shareholding Pattern (Pre and Post Issue)
Particulars Pre-Issue Post-Issue*
No. of Shares % No. of Shares %
Promoter and Promoter Group 41,572,300 84.1 38,367,172 63.2
Total Public Holding 7,847,714 15.9 22,377,629 36.8
Total 49,420,014 100.0 60,744,800 100.0
Source: RHP, Angel Research; Note:* At Upper Price Band of Rs468/share



Investment Rationale

Diversified player
Ramky is currently one of the most Ramky is currently one of the most diversified players in the infra space in India on
diversified players in the infra space in account of operating in six segments and having presence in the major states of
India operating in six segments and the country. Over the years, the company has diversified into new segments
having presence in the major states of thereby expanding its array of services. We believe that diversification helps the
the country
company in sustaining growth in case of any particular segment/region facing
slow down.

Segment-wise – Ramky provides engineering, design, procurement and
construction services across the various sectors including: a) water and waste
water (W&W), b) building construction, c) irrigation, d) industrial, e)
transportation, and f) power transmission and distribution. The
sector-wise order book break-up indicates that the company’s forte lies in the
three segments of W&W, irrigation and transportation.

Exhibit 4: Segment-wise Order Book Break up – FY2010 (Rs cr)

595 223
W&W
1,040 2,452
Transportation
1,561
1,561 Irrigation
Buildings
Power Projects
Industrial


Region-wise – Ramky has been a predominant player in Andhra Pradesh (AP).
However, over the years, the company has ventured in newer regions thereby
reducing its dependence on AP. However, AP still accounts for a decent share
of the company’s overall order book though going ahead the exposure is set
to further recede as the company grows in size and enters into newer
segments.



Exhibit 5: Order Book Increasing pan-India presence (%)

10.0
11.9 34.1 Andhra Pradesh
Western States
12.4
Northern States
Other Southern States
12.6 19.0 Eastern States
Central States


Present in niche segments

The company enjoys strong market Ramky is a leader in the construction of water and waste-water plants. Moreover,
position in the construction of water due to the limited competition in the segment and the company’s experience and
and waste-water plants, which enjoy expertise in the planning, designing and construction of water and waste-water
high margins infrastructure projects, it enjoys an edge while bidding for new projects. We believe
that water and waste-water projects would continue to significantly bolster its order
book. Moreover, this segment enjoys higher margins and helps the company in
maintaining its margins in line with peers in spite of high subcontracting.

Robust Order Book lends revenue visibility

The company increased its order book Ramky’s robust order book of Rs7,432cr (at 3.7x FY2010 revenues) as on FY2010
at a stupendous CAGR of 49.4% over ensures revenue visibility over the next few years with an average execution period
FY2007-10 of 36 months. The company has witnessed a stupendous pace of order book
growth over the last few years – CAGR of 49.4% over FY2007-10. We expect the
company to continue this trend and has already bagged orders worth Rs3,147cr in
1QFY2011, which is >90% of last year’s order inflow. Expertise in water and
waste-water projects and irrigation projects and the increased outlay for the same
from government (centre and state) had led to this growth in order backlog.



Exhibit 6: Order Book growth (Rs cr)

3,000

2,500

2,000

1,500

1,000

500

0
Water Build Trans Power T&D Industrial Irrigation

FY2007 FY2008 FY2009 FY2010


Excellent Return Ratios

Ramky has been able to deliver Ramky has been able to deliver excellent return ratios of more than 20% over
excellent return ratios of more than 20% FY2007-10 vis-à-vis its peers. We believe the differentiating factors for Ramky are
over FY2007-10 vis-à-vis peers careful selection of projects (in-house engineering and designing skill sets) and
optimum utilisation of resources (excellent working capital management).

Exhibit 7: Ramky to sustain healthy return ratios
30.0
28.0 27.9
26.0
24.0 23.6
22.3 22.8
22.0 21.4 21.5
21.3 20.9
20.0 21.4 19.8
19.0
18.0 17.4
16.0
14.0
12.0
10.0
FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
RoAE (%) RoACE (%)




Financial Outlook

Top-line to sustain robust growth

Ramky has grown at a strong pace over Ramky posted strong CAGR of 41.2% in top-line front over FY2007-10 from
the last few years primarily on robust Rs711.5cr to Rs2,002cr primarily on the back of robust order backlog, which
order backlog, which posted CAGR of recorded a CAGR of 49.4% over the period from Rs2,230cr to Rs7,432cr. Expertise
49.4% over FY2007-10 in water and waste water and irrigation projects and increased outlay for the same
from the government (centre and state) lent a boost to the company’s order
backlog. Going ahead also, we expect the company to continue to benefit from the
increasing government spend on infrastructure.

Against this backdrop, we have factored in order inflow of Rs4,500cr and
Rs5,400cr in FY2011 and FY2012 respectively, which would further swell the
company’s order book. It should be noted here that the company has already
bagged orders worth Rs3,150cr (includes Rs2,000cr orders captive/pending
financial closure) in 1QFY2011. Therefore, we are penciling in top-line CAGR of
31.7% over FY2010-12E from Rs2,002cr to Rs3,473cr factoring in average
execution period of 39 months as against management’s guidance of 36 months.

Exhibit 8: Top-line to grow above industry average
12,000 11,083 4.5
4.1 4.0
10,000 3.7 9,217
3.5
3.2 7,432 3.5 3.2
8,000 3.0
3.1 5,923 2.5
6,000
2.0
3,389 3,473
4,000 2,663 1.5
2,230 2,002
1,459 1.0
2,000 712 1,049
0.5
- -
FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E

Top-line (Rs cr, LHS) Order Backlog (Rs cr, LHS) OB/TTM Revenues (x, RHS)


EBITDA margins stable

The company registered 38.2% CAGR Ramky has presence in the high-margin water and waste-water and irrigation
in EBITDA over FY2007-10 and clocked projects. The company does a lot of subcontracting and achieves high asset-
margins in the range of 9-10% during turnover ratio, but it leads to margin dilution. Hence, the company registers
the period margins in line with peers. Over FY2007-10, the company recorded CAGR of
38.2% in EBITDA and clocked margins in the range of 9-10% during the period.

Over the years, the company has intentionally made conscious efforts to optimise
its resources and efficiently utilise capital. In line with this strategy, the company
has been able to enhance its average order size (as depicted in Exhibit 10). We
believe that this will enable the company to maintain stable margins going ahead,
as it would result in better utilisation of resources. However, we have penciled in a
marginal dip in EBITDA margins to factor the rising commodity prices and not
considered any operating leverage benefits. Therefore, we estimate EBITDA to
record a CAGR of 31.0% to Rs334cr from Rs195cr during FY2010-12.



Exhibit 9: Order Inflow momentum to continue Exhibit 10: Avg. order size rising operating leverage
6,000 5,338 10.5 140.0
10.4
5,000 4,449 120.0
3,993 10.0 117.0
9.7
4,000 9.6 9.5 100.0 106.4
9.5 9.5 92.5
3,000 80.0
3,422 9.0 71.3
2,000 1,528 60.0
9.1
1,000 2,207 8.5 40.0
31.3
- 8.0 20.0 21.8
-
FY07

FY08

FY09

FY10

FY11

FY12 FY07 FY08 FY09 FY10 FY11 FY12

Order Inflow (Rs cr, LHS) EBITDA Margins (%, RHS) Average order size (Rs cr)

Source: Company, Angel Research Source: Company, Angel Research

Robust top-line, stable margins to drive bottom-line growth

Ramky has recorded robust 39.2% CAGR in bottom-line over FY2007-10 mainly
aided by strong top-line and stable EBITDA margins. Going ahead, we expect
bottom-line to post a healthy CAGR of 28.9% over FY2010-12.

Exhibit 11: Bottom-line to post healthy growth

400.0 5.6
334.0
350.0 5.4 5.4
300.0 5.2 5.2
252.2
250.0
194.7 5.0 173.3 5.0 5.0
200.0 4.9
138.0 132.2 4.8
150.0
95.6 4.7 104.2
100.0 73.7 68.0 4.6
38.6 51.0
50.0 4.4
- 4.2
FY07 FY08 FY09 FY10 FY11 FY12

Bottom-line (Rs cr, LHS) EBITDA (Rs cr, LHS) PATM (%, RHS)


Exhibit 12: DuPont analysis – High asset turnover ratio, stable margins lead to healthy RoE’s
FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
EBITDA/Sales (%) 10.4 9.1 9.5 9.7 9.5 9.6
Sales/Total Assets 2.2 2.0 2.0 2.2 2.0 2.2
PBT/EBITDA 0.7 0.7 0.6 0.7 0.8 0.8
Adj. PAT/PBT 0.7 0.7 0.8 0.8 0.7 0.7
Total Assets / Net Worth 1.6 2.0 2.2 2.1 1.4 1.5
RoE (%) 19.0 22.3 23.6 27.9 19.8 17.4



Concerns

Dependence on third-party contractors and execution delays

Construction constitutes a major chunk of the total project cost. But, Ramky does
not have an in-house construction arm unlike its peers and is dependent on third-
party contractors to execute projects. This makes its revenue profile vulnerable, as
it does not have a direct control over construction. The company is also exposed to
higher execution risks, which could impact profitability due to delays in execution.

Slow moving order book

As on June 30, 2010, Ramky had an order book of >10,000cr including slow
moving orders to the tune of Rs3,300cr on account of pending financial closure
(captive orders) and AP crisis. However, due to the robust sector outlook and
orders in hand we believe this would not materially impact the company’s
near-term revenues. Also, the AP projects have started picking up albeit at a slower
pace and the dues from the AP government is currently at <Rs10cr as per
management which we believe is decent.

Claims Section 80IA benefits

Ramky continues to claim benefits under Section 80 IA even though they were
withdrawn in Budget 2008 and clarified later. According to the company, it fulfills
all the required conditions under the clause of being an infrastructure developer.
The matter is currently sub-judice. However, we have assumed full tax rates going
ahead. It should be noted that any decision against the company would not dent
its cash position as per management and would require only an adjustment in the
books.



Outlook

We believe that Ramky is well-placed to leverage on the emerging opportunities in
the infrastructure space on account of having one of the most diversified order
books, and exposure to the growing sectors of transportation and water and
power. We believe that its BOT/BOOT project portfolio would also help sustain
revenues– management has guided 40% revenue contribution from the
development business going ahead.

On a standalone basis, we expect Ramky to post a CAGR of 31.7% and 28.9%
over FY2010-12 in top-line and bottom-line front owing to: 1) Strong order book
at 3.7x FY2010 revenues; 2) Presence in growing segments, which would ensure
consistent order inflows; and 3) selective mechanism of choosing projects which
ensures stable margins.

The company claims Section 80IA benefits –is sub-judice– on standalone numbers,
which we believe it is not eligible and hence have not factored in the same.
However, management has guided that there will be no cash outflow in case the
verdict is not favourable given that tax has already been paid and only requires an
adjustment for the tax expense in the books resulting in reduction of reserves.

Valuation
At Rs468 (upper price band), the stock is available at a P/E 15.4x and P/B x 2.5 on
FY2012 standalone numbers. Adjusting for investments, the stock is available at a
premium to its peers - P/E of 13.1x and P/B of 2.1x on FY2012 estimates. We
believe that the premium is justified due to its superior return ratios and higher
growth prospects.

We have valued the company on SOTP basis and arrived at a Target Price of
Rs495 wherein we have assigned a P/E of 14x FY2012E earnings fetching
Rs426/share for its standalone C&EPC business in line with peers like IVRCL and
NCC. We have valued the company’s investments in assets at 1.5x equity fetching
Rs69/share, which is at a discount to asset owners like IRB and ITNL. However, our
SOTP Target Price provides limited upside of ~6% from the upper price band.
Nonetheless, we recommend a Subscribe view on the issue, as we believe that the
company is well- poised to grow over the long term with the catalysts in place, viz.
the company’s unique assets, which would give returns in years to come.
Currently, with these assets at different stages it is difficult to assign a value to
them.



Exhibit 13: Key Financials (Standalone)
Y/E March (Rs cr) FY2009 FY2010 FY2011E FY2012E
Net Sales (incl op. income) 1459 2002 2663 3473
% chg 39.1 37.2 33.0 30.4
Adj. Net Profit 68.0 104.2 132.2 173.3
% chg 33.2 53.3 26.9 31.0
FDEPS (Rs) 11.9 18.3 23.2 30.5
EBITDA Margin (%) 9.5 9.7 9.5 9.6
P/E (x) 39.2 25.5 20.1 15.4
RoAE (%) 23.6 27.9 19.8 17.4
RoACE (%) 20.9 22.8 21.4 21.5
P/BV (x) 8.3 6.2 2.9 2.5
EV/Sales (x) 2.0 1.5 1.1 0.9
EV/EBITDA (x) 21.7 15.4 11.3 9.2

Exhibit 14: Key assumptions
Particulars FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Opening Order Backlog 1,414 2,231 3,389 5,923 7,432 9,217
Add: Order Booking 1,528 2,207 3,993 3,422 4,449 5,338
Less: Execution 712 1,049 1,459 2,002 2,663 3,473
Closing Order Backlog 2,230 3,389 5,923 7,432 9,217 11,083

Exhibit 15: Comparative Valuation
Company CMP TP Rating Top-line (Rs cr) EPS (Rs) RoE (%) Adj. P/E* (x)
(Rs) (Rs) FY10 FY11E FY12E CAGR (%) FY10 FY11E FY12E CAGR (%) FY10 FY11E FY12E FY10 FY11E FY12E
HCC 64 - Neutral 3,629 4,146 4,900 16.2 2.7 1.6 1.8 (17.4) 6.5 6.2 7.0 9.9 16.8 14.5
IVRCL Infra 160 216 Buy 5,492 6,493 8,071 21.2 7.8 8.8 10.9 18.2 11.5 12.1 13.4 12.3 11.0 8.8
NCC. 160 201 Buy 4,778 5,738 6,587 17.4 7.8 8.6 9.8 12.3 10.2 9.6 10.0 12.4 11.2 9.9
Simplex Infra 480 573 Buy 4,564 5,460 6,543 19.7 25.6 33.0 40.9 26.5 13.5 15.6 16.6 18.7 14.6 11.7
Average 4,616 5,459 6,525 18.9 11.0 13.0 15.9 20.3 10.4 10.9 11.8 13.3 13.3 11.2
Ramky 468 495 Subscribe 2,002 2,663 3,473 31.7 18.3 23.2 30.5 28.9 27.9 19.8 17.4 21.8 17.2 13.1

Source: Company, Angel Research; *Note: Adjustments in P/E made for following investments in subsidiaries – 1.HCC’s stake in subsidiaries is valued at
Rs37/share, 2. IVRCL’s stake in IVR Prime and HDOR together is valued at Rs63/share, 3.NCC’s stake in subsidiaries is valued at Rs63/share, 4.Simplex
Infra has no investments in subsidiaries, 5. Ramky’s stake in subsidiaries is valued at Rs69/share.



Profit & Loss Statement (Standalone)
Y/E March (Rs cr) FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Net Sales 712 1,049 1,459 2,002 2,663 3,473
Other operating income - - - - - -
Total operating income 712 1,049 1,459 2,002 2,663 3,473
% chg 47.5 39.1 37.2 33.0 30.4
Total Expenditure 638 954 1,321 1,808 2,411 3,139
Net Raw Materials 175 240 403 432 582 754
Sub-contractor costs 278 475 617 949 1,262 1,645
Other Mfg costs 152 186 220 324 432 563
Personnel 18 27 49 57 76 99
Other 16 25 32 45 60 78
EBITDA 73.7 95.6 138.0 194.7 252.2 334.0
% chg - 29.7 44.4 41.0 29.5 32.5
(% of Net Sales) 10.4 9.1 9.5 9.7 9.5 9.6
Depreciation 4.0 5.2 9.2 10.5 15.4 21.6
EBIT 69.7 90.4 128.8 184.2 236.7 312.4
% chg 29.8 42.4 43.0 28.5 32.0
(% of Net Sales) 9.8 8.6 8.8 9.2 8.9 9.0
Int. & other charges 19.3 28.5 53.4 61.2 53.9 67.7
Other Income 3.9 6.8 9.5 7.0 14.5 13.9
(% of PBT) 7.1 9.8 11.2 5.4 7.4 5.4
Asso. Profit share - - - - - -
Recurring PBT 54.2 68.7 84.9 130.0 197.3 258.6
% chg 26.6 23.7 53.0 51.8 31.0
Extraordinary exp/(inc.) - - - - - -
PBT (reported) 54.2 68.7 84.9 130.0 197.3 258.6
Tax 15.6 17.6 17.0 25.7 65.1 85.3
(% of PBT) 28.8 25.7 20.0 19.8 33.0 33.0
PAT (reported) 38.6 51.0 68.0 104.2 132.2 173.3
Add: Asso. earnings - - - - - -
Less: Minority interest (MI) - - - - - -
Prior period items - - - - - -
PAT after MI (reported) 38.6 51.0 68.0 104.2 132.2 173.3
ADJ. PAT 38.6 51.0 68.0 104.2 132.2 173.3
% chg 32.2 33.2 53.3 26.9 31.0
(% of Net Sales) 5.4 4.9 4.7 5.2 5.0 5.0
Basic EPS (Rs) 8.0 10.5 13.8 21.1 23.2 30.5
Fully Diluted EPS (Rs) 6.8 9.0 11.9 18.3 23.2 30.5
% chg 32.2 33.2 53.3 26.9 31.0



Balance Sheet (Standalone)
SOURCES OF FUNDS
Equity Share Capital 7.1 49.4 49.4 49.4 56.9 56.9
Preference Capital 1.1 - - - - -
Reserves& Surplus 194.9 204.6 272.6 376.8 851.6 1,024.9
Shareholder’s Funds 203.0 254.1 322.0 426.3 908.5 1,081.8
Total Loans 123.6 264.4 389.9 473.9 399.5 520.9
Deferred Tax Liability - - - - - -
Total Liabilities 326.6 518.5 711.9 900.2 1,308.0 1,602.7
APPLICATION OF FUNDS
Gross Block 57.9 81.2 157.6 170.0 250.0 350.0
Less: Acc. Depreciation 10.1 15.2 24.4 34.8 50.3 71.8
Net Block 47.8 66.0 133.1 135.2 199.7 278.1
Capital Work-in-Progress 23.8 2.8 3.4 3.5 3.5 3.5
Goodwill - - - - - -
Investments 19.2 19.6 52.7 60.1 160.1 260.1
Deferred Tax Asset (net) 4.7 5.9 3.1 0.7 0.7 0.7
Current Assets 537.9 902.6 1,177.8 1,607.1 2,149.5 2,632.1
Inventories 50.0 91.8 179.9 330.9 440.1 573.8
Sundry Debtors 239.8 447.9 564.8 574.4 764.0 996.2
Cash 63.0 49.5 61.9 138.4 225.2 123.1
Loans & Advances 97.4 255.4 255.5 381.2 507.1 661.2
Other 87.7 58.0 115.8 182.2 213.1 277.8
Current liabilities 306.8 478.3 658.2 906.3 1,205.5 1,571.8
Net Current Assets 231.1 424.2 519.6 700.8 944.0 1,060.3
Mis. Exp. not written off - - - - - -
Total Assets 326.6 518.5 711.9 900.2 1,308.0 1,602.7



Cash Flow Statement (Standalone)
Profit before tax 54.2 68.7 84.9 130.0 197.3 258.6
Depreciation 4.0 5.2 9.2 10.5 15.4 21.6
Change in Working Capital 167.1 198.9 53.6 82.7 156.4 218.4
Less: Other income 1.5 2.7 2.6 2.7 14.5 13.9
Direct taxes paid 6.5 28.5 42.4 46.1 65.1 85.3
Cash Flow from Operations (116.8) (156.2) (4.4) 9.0 (23.3) (37.5)
(Inc.)/ Dec. in Fixed Assets (42.4) (2.4) (77.1) (12.8) (80.0) (100.0)
(Inc.)/ Dec. in Investments (15.0) (0.4) (33.1) (7.4) (100.0) (100.0)
Other income 1.1 2.2 1.5 2.1 14.5 13.9
Cash Flow from Investing (56.4) (0.5) (108.7) (18.1) (165.5) (186.1)
Issue of Equity 123.1 - - - 350.0 -
Inc./(Dec.) in loans 81.7 140.5 125.8 84.0 (74.4) 121.4
Dividend Paid (Incl. Tax) - - - - - -
Others (0.2) 2.7 (0.3) 1.6 - -
Cash Flow from Financing 204.6 143.2 125.5 85.6 275.6 121.4
Inc./(Dec.) in Cash 31.4 (13.6) 12.4 76.5 86.8 (102.1)
Opening Cash balances 31.6 63.0 49.5 61.9 138.4 225.2
Closing Cash balances 63.0 49.5 61.9 138.4 225.2 123.1



Key Ratios
Y/E March FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Valuation Ratio (x)
P/E (on FDEPS) 69.0 52.2 39.2 25.5 20.1 15.4
P/CEPS 62.5 47.4 34.5 23.2 18.0 13.7
P/BV 13.1 10.5 8.3 6.2 2.9 2.5
Dividend yield (%) - - - - - -
EV/Sales 3.8 2.7 2.0 1.5 1.1 0.9
EV/EBITDA 37.0 30.1 21.7 15.4 11.3 9.2
EV / Total Assets 8.3 5.6 4.2 3.3 2.2 1.9
Per Share Data (Rs)
EPS (Basic) 8.0 10.5 13.8 21.1 23.2 30.5
EPS (fully diluted) 6.8 9.0 11.9 18.3 23.2 30.5
Cash EPS 7.5 9.9 13.6 20.2 25.9 34.2
DPS - - - - - -
Book Value 35.7 44.7 56.6 74.9 159.7 190.1
Dupont Analysis
EBIT margin 9.8 8.6 8.8 9.2 8.9 9.0
Tax retention ratio 0.7 0.7 0.8 0.8 0.7 0.7
Asset turnover (x) 2.7 2.9 2.6 2.8 2.9 2.7
ROIC (Post-tax) 18.8 18.3 18.4 20.9 17.2 16.3
Cost of Debt (Post Tax) 11.1 10.9 13.1 11.4 8.3 9.9
Leverage (x) 0.3 0.6 0.9 0.9 0.4 0.3
Operating ROE 21.1 22.8 23.5 29.4 20.6 18.2
Returns (%)
ROACE (Pre-tax) 21.3 21.4 20.9 22.8 21.4 21.5
Angel ROIC (Pre-tax) 26.4 24.7 23.0 26.1 25.7 24.4
ROAE 19.0 22.3 23.6 27.9 19.8 17.4
Turnover ratios (x)
Asset Turnover (Gross Block) 12.3 15.1 12.2 12.2 12.7 11.6
Inventory / Sales (days) 26 25 34 47 53 53
Receivables (days) 123 120 127 104 92 93
Payables (days) 176 150 157 158 160 161
Work cap. cycle (ex-cash) (days) 86.2 94.4 104.1 93.0 87.8 87.0
Solvency ratios (x)
Net debt to equity 0.3 0.8 1.0 0.8 0.2 0.4
Net debt to EBITDA 0.8 2.2 2.4 1.7 0.7 1.2
Interest Coverage (EBIT/Int.) 3.6 3.2 2.4 3.0 4.4 4.6



Research Team Tel: 022 - 4040 3800 E-mail: research@angeltrade.com Website: www.angeltrade.com

DISCLAIMER

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 investment.

Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make
investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this
document are those of the analyst, and the company may or may not subscribe to all the views expressed within.

Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals.

The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.
Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify,
nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While
Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory,
compliance, or other reasons that prevent us from doing so.
This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,
redistributed or passed on, directly or indirectly.

Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or
other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in
the past.

Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in
connection with the use of this information.

Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please
refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and
its affiliates may have investment positions in the stocks recommended in this report.



Address: Acme Plaza, ‘A’ Wing, 3rd Floor, M.V. Road, Opp. Sangam Cinema, Andheri (E), Mumbai - 400 059.
Tel: (022) 3952 4568 / 4040 3800
Research Team
Fundamental:
Sarabjit Kour Nangra VP-Research, Pharmaceutical sarabjit@angeltrade.com
Vaibhav Agrawal VP-Research, Banking vaibhav.agrawal@angeltrade.com
Vaishali Jajoo Automobile vaishali.jajoo@angeltrade.com
Shailesh Kanani Infrastructure, Real Estate shailesh.kanani@angeltrade.com
Anand Shah FMCG, Media anand.shah@angeltrade.com
Deepak Pareek Oil & Gas deepak.pareek@angeltrade.com
Sushant Dalmia Pharmaceutical sushant.dalmia@angeltrade.com
Rupesh Sankhe Cement, Power rupeshd.sankhe@angeltrade.com
Param Desai Real Estate, Logistics, Shipping paramv.desai@angeltrade.com
Sageraj Bariya Fertiliser, Mid-cap sageraj.bariya@angeltrade.com
Viraj Nadkarni Retail, Hotels, Mid-cap virajm.nadkarni@angeltrade.com
Paresh Jain Metals & Mining pareshn.jain@angeltrade.com
Amit Rane Banking amitn.rane@angeltrade.com
John Perinchery Capital Goods john.perinchery@angeltrade.com
Srishti Anand IT, Telecom srishti.anand@angeltrade.com
Jai Sharda Mid-cap jai.sharda@angeltrade.com
Sharan Lillaney Mid-cap sharanb.lillaney@angeltrade.com
Amit Vora Research Associate (Oil & Gas) amit.vora@angeltrade.com
V Srinivasan Research Associate (Cement, Power) v.srinivasan@angeltrade.com
Mihir Salot Research Associate (Logistics, Shipping) mihirr.salot@angeltrade.com
Chitrangda Kapur Research Associate (FMCG, Media) chitrangdar.kapur@angeltrade.com
Vibha Salvi Research Associate (IT, Telecom) vibhas.salvi@angeltrade.com
Pooja Jain Research Associate (Metals & Mining) pooja.j@angeltrade.com
Yaresh Kothari Research Associate (Automobile) yareshb.kothari@angeltrade.com
Shrinivas Bhutda Research Associate (Banking) shrinivas.bhutda@angeltrade.com
Sreekanth P.V.S Research Associate (FMCG, Media) sreekanth.s@angeltrade.com
Hemang Thaker Research Associate (Capital Goods) hemang.thaker@angeltrade.com
Nitin Arora Research Associate (Infra, Real Estate) nitin.arora@angeltrade.com

Technicals:
Shardul Kulkarni Sr. Technical Analyst shardul.kulkarni@angeltrade.com
Mileen Vasudeo Technical Analyst vasudeo.kamalakant@angeltrade.com
Derivatives:
Siddarth Bhamre Head - Derivatives siddarth.bhamre@angeltrade.com
Jaya Agarwal Derivative Analyst jaya.agarwal@angeltrade.com

Institutional Sales Team:
Mayuresh Joshi VP - Institutional Sales mayuresh.joshi@angeltrade.com
Abhimanyu Sofat AVP - Institutional Sales abhimanyu.sofat@angeltrade.com
Nitesh Jalan Sr. Manager niteshk.jalan@angeltrade.com
Pranav Modi Sr. Manager pranavs.modi@angeltrade.com
Sandeep Jangir Sr. Manager sandeepp.jangir@angeltrade.com
Ganesh Iyer Sr. Manager ganeshb.Iyer@angeltrade.com
Jay Harsora Sr. Dealer jayr.harsora@angeltrade.com
Meenakshi Chavan Dealer meenakshis.chavan@angeltrade.com
Gaurang Tisani Dealer gaurangp.tisani@angeltrade.com

Production Team:
Bharathi Shetty Research Editor bharathi.shetty@angeltrade.com
Simran Kaur Research Editor simran.kaur@angeltrade.com
Bharat Patil Production bharat.patil@angeltrade.com
Dilip Patel Production dilipm.patel@angeltrade.com

Angel Broking Ltd: BSE Sebi Regn No : INB 010996539 / CDSL Regn No: IN - DP - CDSL - 234 - 2004 / PMS Regn Code: PM/INP000001546 Angel Securities Ltd:BSE: INB010994639/INF010994639 NSE: INB230994635/INF230994635 Membership numbers: BSE 028/NSE:09946
Angel Capital & Debt Market Ltd: INB 231279838 / NSE FNO: INF 231279838 / NSE Member code -12798 Angel Commodities Broking (P) Ltd: MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX : Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302


Ramky Infra IPO

Recommended

Recommended

More Related Content

Similar to Ramky Infra IPO

Similar to Ramky Infra IPO (20)

More from Angel Broking

More from Angel Broking (20)

Ramky Infra IPO