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Trading volumes up by 10% in Q4

Reported PAT declined 47% YoY; adjusted PAT up 12% YoY

PTC India’s (PTCIN IN) Q4 reported revenue (standalone) declined 1.4% YoY to INR 33bn. Surcharge income in Q4 rose 24% YoY to INR 930mn. Net rebate rose 3.4% YoY to INR 300mn in Q4FY24. Core margin increased 1% to 2.94 paisa per unit versus 2.91 paisa per unit last year. Traded volumes increased 10% YoY to 18,024mn units (MU). Reported PAT declined 47% YoY to INR 829mn. PTCIN reported an exceptional item of INR 205mn in Q4 on account of provision created against the amount deposited with a supplier. An exceptional item of INR 500mn was reported last year on account of impairment provision. Factoring in exceptional item, adjusted profit rose 12.3% YoY to INR 1,224mn.

Volume mix – Keen on pivoting to high-margin segments    

Volume of short-term trades increased 17% YoY to 11,789MU and volumes of medium- and long-term trades declined 1.6% to 6,235MU. Short-term volume comprised 65% of total volume in Q4FY24 and long- and medium-term volume 30% and 5%, respectively.

PTCIN seeks to keep the proportion of short-term trades and long- and medium-term trades at 50-50. Long- and medium-term segments are high-margin segments for PTCIN.      

Valuations: Maintain Reduce; TP unchanged at INR 207

We revise FY25E-26E earnings and maintain Reduce with TP unchanged at INR 207.

We value the standalone operations at INR 119 per share on 9.0x FY26E P/E. We ascribe a value of INR 49 per share to PTCIN’s investment in PFS, INR 25 per share to its investment in PTC Energy, INR 7 per share to its investment in HPX and INR 7 per share for cash and other investments.

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SEBI Registration number is INH000000933