Thermax, in its fourth quarter reported strong numbers with 16 percent growth in revenues to Rs 2,310 crore, 48 percent jump in operating profitability to Rs 200 crore and 190 bps improvement in margins to 8.7 percent. The net profits soared 52 percent to Rs 156 crore versus Rs 103 crore in the same quarter quarter of last year.
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The company in its press release said margins jump was supported by stable steel, chemical and commodity prices. Alongside, Government has increased its spending on infrastructure and transportation. Furthermore, the Government's capex on green technologies is expected to aid clean energy portfolio.
The order booking for the quarter was 34 percent lower at Rs. 2,254 crore. In the last quarter of the previous year, a significant order of Rs. 1, 176 crore was booked for a sulphur recovery block and an order of Rs. 546 crore was received for a flue gas desulphurisation (FGD) system.
The company has now reclassified its segments to Industrial Products with near 40 percent of FY23 revenue, Industrial Infrastructure (47 percent), Green solutions (4 percent) and Chemicals (8 percent). In fourth quarter of financial year 2022-23, Industrial products grew 12.4 percent year on year to Rs 980 crore, Industrial Infra grew 17.7 percent to Rs 1,160 crore, Green Solutions grew 24 percent to Rs 85 crore and Chemicals grew 27.4 percent to Rs 170 crore.
FY23 order booking stood 7 percent lower at Rs 8,788 crore. In an interaction with CNBC-TV18, Ashish Bhandari, Thermax said he does not expect many large orders in the near term.
"We are seeing new orders in steel and newer industries, compared with last year, which saw order flows in industries like refining and petrochemicals". He added, "Textiles sector is going through a tougher run".
The company is witnessing a slowdown in its traditional business segments and is now focusing on newer industries like biomass and green hydrogen. It does not expect any large orders in the green hydrogen space. "Very difficult to say what even a year from now would look like in the green hydrogen space".
Bhandari added "We are in a stable commodity price environment and demand is strong." If such a trend continues, the company is optimistic to deliver strong performance in future.
Macquarie has a neutral rating on stock with target price of Rs 2,300, while Prabhudas Lilladher has a buy rating with Rs 2,608 as target price.
The board recommended a final dividend of Rs 10/share. The stock is trading 4 percent lower on the exchanges at noon on Thursday.
