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Bajaj Auto Limited (BAL) – Q2FY11 result expectation
Driven by strong volume growth (46% YoY and 8% QoQ), expect EBIDTA margins to expand by 120bps QoQ. Margins to decline 80 bps YoY despite strong volume growth, due to higher RM to sales YoY. Key things to watch our for (1) capacity ramp up (2) export targets and (3) currency hedges for FY12.
n We expect net sales to grow by 43.1% YoY and 6.2% QoQ to Rs 41.3 bn
n We expect EBIDTA to grow by 37.3% YoY and 12.5% QoQ to Rs 8.7 bn
n EBIDTA margin are likely to decline by 80bps YoY but expand by 120bps QoQ to 21.2%
n We expect APAT to grow 49.6% YoY and 10.2% QoQ to Rs 6.5 bn
Coromandel International Q2FY11 Results Expectation : Net Sales Rs 23.8 bn, PAT Rs 1.4 bn
Coromandel International is expected to report their Q2FY11 results today i.e. October 19th, 2010.
We expect fertiliser volumes to increase by 40% YoY to 950,000 MT which along with ~3% increase in realisations is likely to lead to a 55% YoY increase in net revenues to Rs 23.8 bn. As the company is likely to do higher trading this quarter we estimate EBITDA margins to fall by 160 bps YoY to 10% as implied EBITDA / mt is expected to decline by 3% to Rs 2,500. We estimate overall EBITDA to increase by 34.5% to Rs 2.4 bn followed by 26% increase in APAT to Rs 1.4 bn. We estimate AEPS of Rs 10.2 in Q2FY11 versus Rs 8.1 last year.
For H1FY11, we expect the company to report 26% growth in revenues to Rs 39.3 bn followed by a 70% YoY expansion in EBITDA to Rs 4.3 bn. We estimate expansion in EBITDA margins by 280 bps to 10.9%. Aggregate AEPS for H1FY11 is expected at Rs 18.9 over Rs 11.8 last year. For the full year FY11, we estimate AEPS of Rs 38.2.
HDFC Bank Q2FY11 result estimates
HDFC bank’s NII is expected to grow by 30.7%yoy to Rs25.6bn driven by strong growth in advances. High trading gains of Q2FY10 to slightly hurt the operating performance. However Core operating performance to remain strong with 32% yoy growth. Key things to watch – fee income growth and cost ratios.
Larsen & Toubro Q2FY11 Results (Standalone) – First Cut Analysis
In line with estimates
L&T net profits were in line with our estimates.
n L&T reported healthy revenue growth at 18% yoy to Rs93.3 bn, in line with estimates - led by 17% yoy growth in E&C segment to Rs80.15 bn. M&IP division reported robust growth at 37% yoy to Rs7.0 bn. However E&E division declined 5% yoy to Rs6.7 bn (Vs our expectation of 8% yoy growth).
n EBITDA margins improved marginally by 20 bps yoy to 10.8% - below estimates of 12.3%. Hence EBITDA growth at 20% yoy to Rs10.1 bn was below estimates. Lower than expected operational performance is primarily due to higher raw material costs and other expenses
n But, led by high other income, APAT growth at 14% yoy to Rs6.3 bn was inline with estimates. L&T reported net profit of Rs7.7 bn after accounting for Rs0.7 bn on profit from sale of stake in Mahindra Satyam and Rs0.7 bn from reversal of provision.
n L&T witnessed order inflows worth Rs204 bn bn (up 11% yoy). Its total outstanding order backlog has increased to Rs1154 bn.
n We maintain our FY11E and FY12E consolidated earnings of Rs69.0 and Rs84.0 per share respectively
n AT CMP of Rs1989, the stock is trading at 28.8X FY11E and 23.7X FY12E consolidated earnings. We have a ACCUMULATE rating on the stock.
PS – Please find attached the results press release and details results
Mannapuram Q2FY11 Result Update; Strong operating performance; HOLD; Target Price: Rs 160
n MAGFIL reported robust numbers on expected lines for Q2FY11 with NII at Rs1.8bn and PAT at Rs602mn, up 26% and 30.4% qoq driven by 47% qoq growth in AUMs
n Net NPAs (Gold) declined to 0.11% from 0.17% despite sharp growth in AUMs
n We remain wary of the strong growth in AUMs of MAGFIL. Successful execution to QIP (Rs10bn) and ability to contain NPAs key to justify the recent run up in the stock price
n Valuations at 2.4x FY12E ABV still attractive with RoEs of 25% (building in the QIP) . We downgrade the stock to HOLD with price target of Rs160
Alembic Management Meet; Payback time; Not Rated
n De-merger to insulate core pharma business from the volatility of the Pen G business
n Real estate development presents strong value unlocking potential
n Growth drivers for pharma are in place; strong growth trajectory ahead
n Significant room for margin expansion.
n Trading at 30-40% discount to comparable peers; provides substantial room for upside
Unichem Labs Initiating Coverage; Gearing for growth; BUY; Target Price: Rs 670
n Increased focus on prescription generation, penetration into tier-II to tier-IV markets and turnaround in Niche Generics to drive 25% earnings CAGR over FY10-13E
n International business to start contributing positively from FY12E, expect 38% revenue CAGR over FY10-13E
n Potential new contracts with MNCs to drive growth on account of higher capacity utilization and operational leverage
n Strong balance sheet, zero debt and robust return ratios provide key comfort to investors; initiate coverage with Buy
n Dealer Comments
The markets did start the day’s session on a positive note with almost 40 odd point’s upward gap led by the pre market price discovery mechanism starting in Nifty and Sensex stocks today, but immediately slipped in the negative zone. The markets precariously languished in the red for most part of the day with intermittent attempts to recover with foiled results. Markets were witnessing very lacklustre session in the absence of any major trigger that could drive the sentiments higher. Except for select stock specific and news based positive movement markets saw good selling pressure across the board. Towards the closing bell markets staged a solid rebound with huge short covering witnessed in Nifty futures with the premium rising from 28 odd points in morning to almost 45 point at the end. Finally markets closed the day on positive note towards the end with Sensex gaining 44 points or 0.22% higher to settle at 20169 levels while Nifty gained a mere 13 points or 0.23% higher to settle at 6076 levels. The overall traded volumes were almost flattish compared to the earlier day and were at Rs 1610 bn. While delivery based volumes were quite higher compared to the earlier day at 42.3% of the total traded turnover. Among the Fund activities FII’s were net buyers to the tune of Rs 1.55 bn while Domestic Funds were net sellers to the tune of Rs 10.85 bn respectively on 15th October 2010. While on 18th October 2010, FII’s bought shares worth Rs. 3.35 bn in cash segment (provisional) while in the F&O segment they were net sellers to the tune of Rs 12.91bn whereas Domestic Funds sold shares worth Rs. 12.18 bn (provisional).
n Technical Comments
Bullish Hammer
Following the previous weeks’ down move, Nifty opened on a softer note and traded below the 6000 mark in the morning session. It took support at the 5985 mark and reversed the losses for the day to close near the highs of the day. In the process it has made a ‘Bullish Hammer’ candlestick pattern on the daily chart, which makes the low of 5985 an important support level. So we still stick to our bullish view for the target of 6500.
BSE Bankex:
BSE Bankex seems to have taken support at the lower Bollinger band with the formation of a Bullish Hammer and hence in the short term this index can heighten upto 14600 level.
n Results Today
Bajaj Auto | Bajaj Holdings | Cadila Health. | Container Corpn | Coromandel Inter | Greaves Cotton |
HDFC Bank | Ingersoll-Rand | Mindtree | Polaris Soft. | Religare Enterp. | Supreme Inds. |
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