Bharat Heavy Electricals (500103) Q4 05/06 earnings summary

Executive summary

• FY2005-06 turnover rose 40.53% to Rs.145,255 million; PAT increased 76.13% to Rs.16,792 million, the highest year-on-year turnover growth in three decades.

• Order inflow reached Rs.189,380 million and the closing order book was Rs.376,000 million for execution in FY2006-07 and beyond.

• Export order inflow hit a record Rs.33,480 million, six times the prior year, expanding overseas business across all six inhabited continents.

Financial highlights

• Revenue from products and services was Rs.145,255 million versus Rs.103,364 million; PBT rose 62.14% to Rs.25,644 million and PAT rose 76.13% to Rs.16,792 million.

• Value added increased 33.58% to Rs.56,828 million; economic value added rose 114.29% to Rs.10,800 million from Rs.5,040 million.

• Proposed dividend was 145% of paid-up capital, including 40% interim and 85% special interim already paid; total dividend was Rs.3,549 million.

• Cash and bank balances, including short-term deposits, were Rs.41,340 million at year-end versus Rs.31,779 million; operating cash inflow was Rs.16,238 million.

Outlook and guidance

• Manufacturing capacity was being expanded from 6,000 MW annually to 10,000 MW by 2007 to address expected demand and upcoming power projects.

• More than Rs.12,000 million of capital investment was planned for the 10th Plan; ~Rs.4,800 million of investment was expected in FY2006-07.

• Strategy priorities included supercritical boiler technology, advanced gas turbines, nuclear power opportunities, project execution, and overseas EPC and service growth.