Shriram EPC

An EPC player, the stock breached the 20% upper circuit yesterday at Rs.40.60, jumping up on hopes that many orders will come its way after the Budget. It is the engineering arm of the Shriram Group and provides end-to-end solutions to engineering challenges offering multi disciplinary design, engineering, procurement, construction and project management services. The Budget has called for a push for water infrastructure, power and the company deals with both these sectors, expected to get major orders in the coming months. About 80% of its orders now come from the PSUs and Govt.

But for this Budget sop, financially, the company is on a weak footing. It ended Q3Fy15 with a  30% (YoY) drop in net sales at Rs.135 crore and net loss for the quarter was at Rs.36 crore v/s loss of Rs.12 crore in previous Q3. Thankfully, this is lower than loss of Rs.70 crore posted in Q2. During Q2FY15, the company entered into a corporate debt restructuring scheme. The revision in interest rates effective under the CDR helped the company save Rs.23.16 crore in finance costs. Promoters stake is at 69.87% of which 20.65% is pledged.