Zen Technologies: PAT growth of 63% & Revenue growth of 92% in Q1-25 at PE of 91
100%+ growth in FY25 supported by a strong Q1-25. Order book in place to support Q1-25 guidance. Revenue CAGR for FY25-27 at 50% to drive revenue to Rs 2,000 cr by FY27.
1. Defence training & anti-drone solutions provider
zentechnologies.com |NSE: ZENTEC
2. FY20-24: PAT CAGR of 22% and Revenue CAGR of 31%
3. FY23: PAT up 2048% & Revenue up 214%
4. Strong FY24: PAT up 197% & Revenue up 101% YoY
5. Strong Q1-25: PAT up 63% & Revenue up 92% YoY
6. Business Metrics: Return Ratios improving strongly
7. Outlook: 100%+ revenue growth in FY25
i. FY25: Revenue growth of 100%+
Revenue to more than double from Rs 440 cr in FY24 to Rs 900cr+ in FY25
We are excited about the future and confident in meeting our guidance of ₹900 crores of turnover in the current financial year
With a robust order book exceeding ₹1400 crores as of March 31, 2024, we are poised for sustained growth in FY25, aiming to surpass the ₹900 crore sales mark.
ii. FY25-27: Revenue CAGR of 50%+
iii. Strong Order book: Oder book in place for Rs 900 cr revenue for FY25
Oder book to be replenished in Q3 and Q4 of FY25
8. PAT growth of 63% & Revenue growth of 92% in Q1-25 at a PE of 91
9. So Wait and Watch
If I hold the stock then one may continue holding on to ZENTEC.
Coverage of ZENTEC was initiated after Q1-24 results. The investment thesis has not changed after a strong FY24 followed by an equally strong Q1-25.
The outlook for ZENTEC is strong in FY25 with a guidance of 100%+ top-line growth on the back of a strong order book. Q1-25 performance provides confidence in the ability of the management to deliver on its guidance.
One needs to keep a watch on the margins expected to reduce from 43% in FY24 to 35% in FY25
One can continue to ride the business momentum in ZENTEC with management guiding for Rs 2,000 cr revenue till FY27.
While the ZENTEC management is guiding for the order book is replenished in H2-25, yet one needs keep a watch on the order book as the entire thesis of Rs 2,000 cr revenue depends on the availability of the order book.
10. Join the ride
If I am looking to enter ZENTEC then
ZENTEC has delivered PAT growth of 63% & Revenue growth of 92% in Q1-25 at a PE of 91 which makes the valuations fully valued in the short term.
ZENTEC is guiding for a revenue growth of 100% to reach Rs 900+ cr in FY25 from Rs 440 cr in FY24 at PE of 91 which makes the valuations fully priced for the FY25 expectations.
ZENTEC is guiding for a FY25-27 revenue growth of 50% to reach Rs 2000 cr in FY27 from Rs 900+ cr in FY25 at PE of 91 which creates the opportunity in the longer term.
Previous coverage of ZENTEC
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