Engineers India Q1 Results Review - Positive Surprise In Order Inflow: ICICI Securities

ICICI Securities Report

Engineers India Ltd. reported a rather subdued quarter with a –

1. 25% decline in revenues; and

2. decline in Ebitda margin (aided by decline in consultancy margins) – resulting in a 52% decline in profit (profit after tax).

Order inflow and the mix in OI turned out to be a pleasant surprise.

Engineers India saw an order inflow of Rs 48 billion, comprising of Rs 26 billion of consultancy and Rs 22 billion of others. Note that consultancy is a more profitable business with healthy margins (22%, FY24). As a result, the consultancy order book, at Rs 55 billion, improved 3.3 times.

Engineers India reiterated its guidance of Rs 35 billion of revenues and Ebit margin of 20% in consultancy (lower than its historical margin). We bake in 300bps of margin improvement in consultancy for FY26E.

We retain 'Reduce' given expensive valuations and revise the target price to Rs 200 (earlier Rs 225).

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