Visit http://indiaer.blogspot.com/ for complete details Result Previews – 2QFY2011
HDFC Bank
HDFC Bank is scheduled to announce its 2QFY2011 results. We expect the bank to report
a healthy NII growth of 31.8% yoy. However, the bank’s NIM is expected to be flattish
sequentially. Other income is expected to register moderate growth of 5.7% yoy. The
bank’s pre-provision profit is expected to register moderate growth of 15.1% yoy, while net
profit is expected to increase by 32.1% on a yoy basis to `909cr on account of lower
provisioning expenses. At the CMP, the stock is trading at valuations of 3.83x FY2012E
ABV, which is closer to our target multiple of 4.0x. Hence, we maintain a Neutral rating on
the stock.
Bajaj Auto
Bajaj Auto is slated to announce its 2QFY2011 results. We expect the company’s top line
to grow by 41% yoy to `3,940cr on account of 45.7% yoy growth in volumes. On the
operating front, EBITDA margin is expected to decline by 243bp yoy to 19.6% due to an
increase in raw-material cost. However, the bottom line is expected to grow by 51% yoy to
`608.4cr. The stock rating is under review.
Container Corporation of India
Concor is scheduled to announce its 2QFY2011 results. The rail container operator is
expected to report a 7.2% yoy decline in the top line to `891cr on account of a hit in
volumes from the Exim segment after the JNPT port was completely shut for five days post
an accident between two sea-faring vessels and prolonged monsoon. We expect Concor’s
OPM to decline by 50bp yoy to 26.9%. Consequently, net profit is expected to decline by
8.7% yoy to `186.5cr. At the CMP, the stock is trading at 17.9x its FY2012E EPS of `72.5.
We maintain our Reduce rating on the stock with a Target Price of `1,194.
Cadila Healthcare
Cadila is expected to post strong 16.9% growth in net sales to `1,067cr on the back of
robust growth on the export and domestic formulation fronts. The company continues to
enjoy over 25% market share in generic Flomax in the US, which is a near-term key driver.
We expect the company's OPM to expand by 159bp to 20.5% on the back of favourable
product mix. Net profit is expected to increase by 17.9% to `156cr, driven by top-line
growth and OPM expansion. We maintain our Neutral rating on the stock.
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