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Defence manufacturer MTAR Technologies shares sink 16%; here's why

On Tuesday, the company posted its Q4FY24 results. Revenue from operations surged 21.1 per cent year on year and stood at Rs 143.0 crore in Q4FY24 as against Rs 118.4 crore

Photo: Shutterstock

Photo: Shutterstock

SI Reporter New Delhi

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Shares of MTAR Technologies sank up to 15.9 per cent to Rs 1,732 per share on the BSE in Wednesday’s intraday deals. This came after the company’s net profits dropped significantly for the January-March quarter of the fiscal year 2023-24 (Q4FY24) and FY24. 

On Tuesday, the company posted its Q4FY24 results. Revenue from operations surged 21.1 per cent year on year and stood at Rs 143.0 crore in Q4FY24 as against Rs 118.4 crore in the same quarter last year. 

Earnings before interest, tax, depreciation and amortisation (Ebitda) reported at Rs 18.2 crore in Q4FY24 as compared to Rs 23.9 crore in Q3FY24, down 23.8 per cent YoY. 

Profit After Tax (PAT) was registered at Rs 4.9 crore in Q4FY24 as against Rs 10.4 crore in Q3FY24, a drop of 52.8 per cent YoY. 

On a full year basis, too, the PAT slipped by 45.6 per cent to Rs 56 crores in FY24 as against Rs 101 crore in  FY23

The company’s revenue, however, improved marginally by 1.2 per cent at Rs 580 crore versus Rs 573 crore in FY23. Ebitda slides by 26.8 per cent in FY24 to Rs 112 crore as compared to Rs 154 crore in FY23.

Parvat Srinivas Reddy, managing director and promoter of MTAR Technologies said that the company registered a lower-than-estimated Ebitda in FY 24 as the operating leverage was lower due to deferment of orders in the Clean Energy segment and delay in execution of projects in Space vertical. 

“We are targeting to achieve a 30- 35 per cent YoY increase in revenues with an EBITDA of 22 per cent +/-100 bps in FY25. Significant orders are expected shortly as we have concluded discussions with some of the major MNCs in Aerospace,” Reddy said in a statement. 

At 10:53 AM; the stock of the company was trading 8.45 per cent lower at Rs 1,887.35. By comparison the S&P BSE Sensex fell 0.66 per cent. MTAR Technologies is presently trading at a price to earnings multiple of 70.85 times.

MTAR Technologies is engaged in manufacturing and developing precision engineered systems catering to clean energy – civil nuclear power, fuel cells, hydel and others, space, and defence sectors 

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First Published: May 29 2024 | 11:16 AM IST

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