Patel Engineering - Low Equity High Growth

Patel Engineering Q2 Net Profit Up 100% To Rs 25.48 Cr

Patel Engineering Ltd., a civil-infrastructure construction company, reported a 103.23 per cent jump in consolidate net profit at Rs 25.48 crore for the second quarter ended September 30, 2006 as compared to Rs 12.54 crore in the corresponding quarter previous year. Consolidated revenues for the quarter rose 32.37 per cent at Rs 243.76 crore as against Rs 184.16 crore during the same period previous year.

The company has posted a 87.32 percent rise in net profit to Rs 45.59 crore for the six months period ended September 30, 2006 compared to Rs 24.34 crore in the corresponding period previous year. Net Income from operation increased by 30.99 percent to Rs 555.83 crore compared to Rs 424.32 crore during the same period previous year.

The company has also witnessed an improvement in margins, with net profit margins improving to 8.20 per cent as against 5.74 per cent during the same period in the previous year. The earning per share (basic and diluted of face value of Re 1) for the quarter stood at Rs 8.01 as on September 30, 2006 compared to Rs 5.01 in the corresponding quarter last year. “With government’s emphasis on infrastructure gaining momentum we continue on a high growth trajectory. We have witnessed significant improvement in our order-book positions and are in the process of bidding for several upcoming development projects”, said Ms. Sonal Patel, Director - COO, Patel Engineering Limited.

She further added, “Patel Engineering, as part of its growth strategy, is moving towards annuity-based projects in road construction and looking at opportunities in hydropower sector as an independent power producer (IPP). Also, with the acquisition of Michigan, technology-led focus is on urban infrastructure projects in metros as well as tier II cities. The company recently acquired a controlling stake in Michigan Engineers Pvt Ltd (MEPL), a Mumbai based urban infrastructure company, for an undisclosed sum. Also, the company was awarded the two projects by Rail Vikas Nigam Ltd, New Delhi worth Rs 176 crore.