Dalal Street

The Edison Mission Group has withdrawn orders of 315 MW (second part of a two-phase 630 MW order) given to Suzlon Energy. This order withdrawal by Edison for 315 MW may affect near-term execution; Suzlon may however replace it by other orders in that geography.

Edison had the option of not purchasing the second part of the contract and it has exercised that option now. No explicit reasons are available for the exercise of the option by Edison. We believe Edison is a large customer of Suzlon (likely among the top 5 with Suzlon having executed (or executing) about 525 MW for this customer. This is significantly bad news for Suzlon Energy.

Voltamp’s net sales increased by 10.4% Y-o-Y to Rs.1351.4 mn in Q4FY08, largely on the back of better price realisations. EBIDTA increased to Rs.334.3 mn in Q4FY08, at 46.1% Y-o-Y growth. EBIDTA margins improved by around 606 bps YoY to 24.7%, mainly due to better price realizations, which led to substantial decrease in raw material cost as a percentage of sales (from 81.3% in Q4FY07 to 75.3% in Q4FY08).

Voltamp’s PAT during Q4FY08 increased to Rs.216.3 mn in Q4FY08. For the full year FY08, the company showed a growth in net sales of 36.9% to Rs. 5553.5 mn. Its EBITDA increased 92.1% from Rs.613.5 mn to Rs.1178.6 mn while it’s adjusted PAT increased from Rs.393.6 mn to Rs.799.0 mn, showing a growth of 103%. The EPS for the full year stood at Rs.79 as against Rs.38.9 last year, registering a growth of around 102.9% Y-o-Y.

Voltamp Transformer’s order backlog as of 8th May 2008 stood at around Rs.4485.1 mn