Sterling and Wilson shares slip 9% on weak Q4 earnings

Shares of Sterling and Wilson Renewable Energy fell over 9% today after the firm reported a widening of its consolidated net loss to Rs 421 crore in the March quarter, mainly due to lower revenues. In the quarter ended March 2022, the consolidated net loss of the company stood at Rs 127 crore.  

Sterling and Wilson stock lost 9.02% to Rs 279 against the previous close of Rs 306.65 on BSE. A total of 0.84 lakh shares of the firm changed hands amounting to a turnover of Rs 2.41 crore on BSE. Market cap of the firm fell to Rs 5381 crore on BSE. The stock has fallen after three days of consecutive gain. It opened 5.51% lower at Rs 289.75 today.  

The share hit a 52 week high of Rs 400 on  April 28, 2022 and a 52 week low of Rs 255.25 on December 26, 2022.  

In terms of technicals, the relative strength index (RSI) of Sterling and Wilson stands at 53.6, signaling it's neither trading in the overbought nor in the oversold territory. The stock has a beta of 0.9, indicating low volatility in a year. Shares of Sterling and Wilson are trading lower than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.  

Net sales slumped to Rs 88.43 crore in Q4 from Rs 1,071 crore a year ago. 

On an annual basis, the firm posted a consolidated net loss of Rs 1,175 crore in the last fiscal against a loss of Rs 916 in the previous fiscal year. 

The company said the revenue was impacted during the (March) quarter due to rise in cost on account of certain cost provisions made, which impacted the percentage-of-completion and led to a revenue reversal in ongoing EPC (engineering procurement construction) projects. 

 Revenue fell 59.5 per cent in FY23 due to lower contribution from ongoing EPC projects, where O&M constituted an 8.9 per cent of revenue in FY23. 

The O&M (operation and maintenance) margins remain impacted by projects where O&M costs were incurred, however, revenue recognition has not commenced due to delay in final handover, it stated. Gross margins remain suppressed primarily on account of International EPC projects, it stated.