Forwarded
*Mishra Dhatu Nigam (NSE: MIDHANI) - Space order inflow may slow down in FY21*
Midhani's new chairman and managing director, Dr. S.K. Jha's commentary highlights that FY20 execution was tilted >60% towards the space sector. Capex for modernization has led to a 60-70% YoY increase in FY20 volumes. Order inflow for FY20 was Rs7.5bn and the order book stood at Rs16.8bn with >70% contribution from space. However, space-related orders and execution are expected to slow down over the next few months. >70% of order inflow expected in FY21 would be from the defense sector as select programs on missile development and air platforms indicate prospective ordering for Midhani. Management is striving to cross the MoU revenue target previously placed with the ministry of defense at Rs7.5bn.
- Orderbook and order inflow. The current order book is worth Rs16.87bn against Rs16.67bn YoY. 70% of it is in the space segment, 20% in defense and the rest is a mix of nuclear, oil and gas, etc. Q1FY21 saw Rs1.5bn of order booking. The company expects FY21 order inflow at Rs7.5bn, 70% of which would be from the defence.
- Outlook on the ISRO program. CMD highlighted that ISRO launches may be delayed by a few months. Orders placed on Midhani need to be executed, but the growing expectation is that there can be a slight delay in terms of the delivery timeline.