Unity Infraprojects is on our investment radar for four reasons. First Unity Infra is involved in the high-growth infrastructure sector of civil works, water, Irrigation & transportation for which there is enormous demand in our country. Second, Unity Infra has an excellent track record of performance. Unity Infra has a 3 Yr CAGR Sales of 41.09 % and a 3 Yr CAGR Profit of 30.79 %. Third, Unity Infra has an order book of about Rs. 3,500 crores (2.3 times FY 2010 sales) affording good revenue visibility. Fourth and most important, at the CMP of Rs. 115 Unity Infra is quoting at a PE of 10 times FY 2010 earnings (PE of 7.5 times FY 2011 expected earnings) which is very reasonable given Unity Infra‘s track record.
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Unity Infra’s Q on Q results
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Apart from Unity Infra‘s excellent track record of performance which is shown by Unity Infra‘s 3 Yr CAGR Sales of 41.09 % and a 3 Yr CAGR Profit of 30.79 % and a Return on Equity of 17.39%, Unity Infra showed good results for Q1 FY 2011. Unity Infra‘s revenues grew 22% y-o-y to Rs 339.8 crores as compared to Rs. 278.62 crores in the same Quarter last year. Unity Infra‘s revenues were made up of 48% of civil works, 39% of water & Irrigation and 13% of transportation. Unity Infra‘s net profit increased to 23.7% y-o-y to Rs. 19.5 crores as compared to 15.77 crores in the same Quarter last year.
| Rs. in Cr. | Mar 2010 | Mar 2009 | Mar 2008 |
| Sales Turnover | 1,525.46 | 1,165.87 | 850.87 |
| Net Profit | 85.63 | 70.33 | 59.88 |
| Total Shareholder’s Funds | 566.20 | 418.77 | 355.47 |
| Total Debt | 686.63 | 482.08 | 282.80 |
| Earning Per Share (Rs.) | 56.93 | 51.84 | 44.11 |
Unity Infra‘s future looks quite secure given that it has an order book of Rs. 3548 crores representing 2.3 times FY 2010 revenues. Unity Infra has L-1 bids of Rs. 600 crores & a bid pipeline of Rs. 1700 crores. Given Unity Infra‘s strong order book, it is not unreasonable to expect Unity Infra‘s revenues & net profit to grow at a CAGR of 18% & 15.2% respectively during FY 09 – FY12.
The risk-reward ratio is in favour of making an investment in Unity Infra.
About Unity Infraprojects:
Unity Infraprojects is an engineering, procurement and construction company engaged in infrastructure projects. Unity Infra is engaged in a vast array of infrastructure projects such as commercial and residential buildings, industrial structures, information technology parks, airports and railway stations, stadiums and sports complexes, hotels, hospitals, universities and educational campuses. Unity Infra‘s infrastructure projects include construction of roads bridges, flyovers and subways; irrigation and water supply projects including dams, tunnels, lift irrigation projects and sewerage schemes.
Unity Infra is also engaged in several prestigious projects. Some of these are three consortium contracts valued at INR 2.39 billion from Municipal Corporation of Greater Mumbai for the design, construction and maintenance of storm water pumping stations in Mumbai, a INR 457.58 million joint venture contract for widening and deepening the Mithi river, RCC retaining wall, and service road, and a INR 283.3 million contract through its joint venture company United Gulf Construction Company WLL for installation of pipe lines by micro tunneling method at various locations in Mumbai for the existing water mains; a INR 1,478.2 million order from the Central Public Works Department to remodel and upgrade Dhyan Chand National Stadium in Delhi and a INR 770 million contract from the Thane Municipal Corporation, Maharasthra for construction of additional 110 MLD water supply scheme from Pise Head Works, both in joint venture; and a INR 1,341.5 million contract from Anuttam Developers for the construction of a shopping centre at Koregaon Park, Pune.
Unity Infraprojects is managed and directed by a team of highly qualified engineers, led by the founder Mr. Kishore K. Avarsekar, a highly rated engineer himself and a self made businessman. Mr. Abhijit K. Avarsekar the Vice Chairman & Managing Director plays a vital role in bagging new orders & setting the pace for Unity Infra to achieve ambitious milestones. The team of engineers and professionals at Unity Infra lay strong emphasis on teamwork, synergy, professionalism and pursuit of excellence. Unity Infra‘s management team is a judicious blend of seasoned veterans, persevering managers and well-networked achievers. Driven by its rich experience, sound technical infrastructure, professional manpower and commitment to timely execution, Unity Infra is fully equipped and ready to undertake infrastructure projects at all locations in India and abroad. (More on Unity Infraprojects and Kishore K. Avarsekar is here).
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