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Punj Lloyd Q2FY11E Result Estimates
Do not expect negative surprise in Q2FY11E. Expect performance to improve on QoQ basis. But, YoY performance to be impacted due to low revenue booking on Libya orders – valued at Rs95 bn
n Revenue growth at 19% QoQ (-28% YoY) to Rs20.7 bn
n EBITDA margins at 7.9% and EBITDA at Rs1.6 bn (+21% QoQ & -23% YoY)
n APAT of 40 mn vs loss of Rs306 mn in Q1FY11.
Management comment on profitable execution of order book (incl. Libya orders) is paramount to rating and earnings upgrade
Voltamp Transformers Q2FY11 Results First Cut
Revenue growth disappoints; EBITDA margins decline significantly
n Revenues grew by 12% yoy to Rs1.25bn –below estimates of Rs1.37bn.
n EBITDA declined by 37% yoy to Rs125mn, below estimates due to EBITDA margins at 10.1% (lower than estimated 15.3% margins) against 17.9% in Q2FY10.
n Net profit declined by 46% yoy to Rs93mn - below our estimate of Rs175mn.
n EPS for the quarter stood at Rs9.2/Share.
n For H1FY11 EPS stood at Rs19.8/share down 37% as compared to Rs31.6/share reported in corresponding period last year
n Our FY11E estimate stands at Rs72.4/Share. Our numbers likely to be downgraded on the back of lower EBITDA margins and lack of pricing visibility.
n At CMP of Rs871, the stock is trading at 12xFY11E earnings & 2.3xFY11E Book Value (ROE of 20%) Detailed note to follow…
Blue Star Q2FY11 Results – First Cut Analysis
Below Estimates
n Blue Star (BLSR) reported disappointing results for Q2FY11 – led by sharp decline in EBITDA margins (-190 bps yoy)
n Led by healthy growth across segments, revenues grew by 23.3% yoy to Rs6948 mn – marginally ahead estimates. EMP & PAC division grew by 12.6% yoy to Rs4.7 bn while Cooling Products division grew by 28.3% yoy to Rs1.4 bn. The PEIS division posted positive surprise by doubling turnover to Rs674 mn.
n Deapite healhy revenue growth, growth in operating profits was muted at 3.5% yoy to Rs672 mn – below estimates. This was due to sharp 190 bps yoy drop in operating margins – attributed to sharp rise in input costs.
n Led by 190 bps yoy decline in EBITDA margins and high interest costs, net profits declined by 12.6% yoy to Rs386 mn – below estimates.
At CMP, the stock is trading at 18.2X FY11E and 15.3X FY12E earnings of Rs25.0 and Rs29.6 per share respectively. We have a BUY rating of the stock with a target price of Rs543.
GlaxoSmithKline Pharma Q3CY10 Result Update; In-line results; Maintain Hold; Target Price: Rs 2,020
n Revenue growth of 14% is above our estimate of 12% mainly because of strong growth in the vaccines business
n Operating margins contracted marginally by 100bps to 36.6% due to 191bps increase in raw material cost
n 52% increase in interest income led to APAT growth of 12% to Rs1.6bn
n Maintain our earning estimates of Rs68.2 and Rs77.5 for FY11E and FY12E respectively; Maintain Hold
Andhra Bank Q2FY11 Result Update; Operating performance inline; Slippages Rise; BUY; Target Price: Rs 210
n NII growth ahead of estimates led by 27% growth in advances and 17bps qoq expansion in NIMs. However net profit slightly below expectations
n Lower employee expenses partially offset negative impact of lower other income and higher provisioning
n Asset quality deteriorated as GNPA and NNPA increased 33% and 75% sequentially. Provision cover fell to 61% (70% as per RBI norms) from 70% in Q1FY11
n Valuations attractive at 1.7x FY11E/1.3x FY12E ABV. We maintain our BUY rating with price target of Rs210
IRB Infrastructure Developers Q2FY11 Result Update; Positives in construction & BOT number disappoints; Target Price: Rs 304
n PAT at Rs991 mn (+39.9% yoy) ahead of our and street expectation – driven by better than expected construction margins (22.7% v/s est of 18.1%) and MAT credit of Rs83 mn
n Revenue (Rs4.9 bn) growth of +37.8%yoy - aided by +48.1% yoy growth in construction segment and 25.1%yoy growth in BOT segment
n EBITDA at Rs2.36 bn (+35.3% yoy) higher than estimates (Rs2.19 bn), driven by 83.3% growth in construction EBIDTA & 22.9% growth in BOT EBIDTA
n Slower ramp up in traffic at Bharuch Surat & Surat Dahisar playing spoil sport for BOT. -5.7% downgrade FY11E/12E earnings by 5.7%/4.7%. Retain ACCUMULATE-Target Rs304
ICICI Bank Q2FY11 Result Update; Extraordinary performance; HOLD; Target Price: Rs 1,200
n ICICI Bank’s Q2FY11 NII/PAT at Rs22.0/12.4bn were ahead of our estimates. The stronger performance was driven by better NIMs (+10bps qoq) and lower than expected provisions
n The net addition to ICICI Bank’s NPAs was almost zero during the quarter. Total/retail net slippages at Rs2.6bn/1.7bn, only due to BoR merger
n Other positives: (1) 13% qoq growth in core operating profit driven by strong fees and (2) provision cover at 69%, reached 70% earlier than guided.
n Valuations at 2.2x FY11E/2.0x standalone FY12E ABV not unreasonable looking at peer group valuations. Upgrade to HOLD with TP of Rs1200
BHEL Q2FY11 Result Update; Strong Performance, Clear Path Ahead; Retain BUY; Target Price: Rs 3,030
n BHEL report strong performance – Revenues up 26% yoy to Rs87.2 bn, EBITDA margins improve 60 bps yoy to 17.7%, Net profits increase 33% yoy to Rs11.4 bn
n Bagged orders worth Rs200 bn during Jul-Oct’10 – achieved 50% of FY11E target orders. Order book at Rs1537 bn
n H1FY11 performance on all counts, gives comfort to achieve FY11E estimates – enhances probability of earnings upgrade
n Maintain earnings estimates of FY11E (Rs110.6/Share) and FY12E (Rs129.0/Share)- with target price of Rs3,030/Share
Hero Honda Q2FY11 Result Update; Margins disappoints, lower rating to REDUCE; Target Price: Rs 1,720
n EBIDTA margin disappoints at 13.4% (est. of 15.2%). APAT at Rs 5.1bn was 10% below our est. of Rs 5.7bn. Margins suffer due to higher RM cost and other expenses
n H2FY11 margin est. of 14.4% at risk in absence of price hikes. Excise (cess) demand notice for Haridwar plant, would further impact margins by 1 %, currently unaccounted in P&L
n Maintain FY11E/FY12E volumes est. of 5.3mn/5.9mn units. Downgrade FY11E/FY12E EPS by 11 each to Rs 107.2/122.8
n Downgrade rating to REDUCE from HOLD, revise TP to Rs1,720 (down 11%) - 14x FY12 EPS. Continue to prefer Bajaj Auto over Hero Honda
M&M Q2FY11 Result Update; Margin surprises positively, Raise TP to Rs 880; BUY
n Adj. EBIDTA at Rs 8.5bn (above est. of Rs 7.9bn) Margins at 15.8%against est.14.6%. APAT at Rs 7.1bn (est. Rs 6.4bn) due strong operating performance & other income
n H2FY11 to see volume traction as capacity constraints addressed. Upgrade FY11E/FY12E volumes by 5.8%/8.4% to 529,762mn/581,175mn units, with upward bias
n Ssangyong acquisition on course, expected to be completed by February/March 2010. Maintain our view that there could be surprises as and when the details are shared
n Upgrade TP to Rs880 (up 13%). Valuing standalone business at Rs 706 (+11%)-9x EV/EBIDTA, listed subsidiaries at Rs 174 (+22%)-20 disc to market cap. Maintain BUY
n Technical Comments
5960 – 6100: Range for the coming session
For followers of technical analysis, Nifty has made a “Doji” on monthly charts, which is usually a sign of weakness, but we believe that the major part of the weakness has ended in October itself and hence the probability of Nifty falling back upto 5830 has drastically reduced, if not negated. Moreover, Nifty did not close below 5960 mark, after a little bit of whipsawing in today’s session and hence there is a possibility that something could have ended in today’s session itself. However, until Nifty goes pass 6100, prices will trade within the band of 5960-6100.
BSE Metal
BSE metal index has taken support at the internal trendline drawn along the highs of June and August 2010, which indicates that the current trend will again resume and one can look for targets in range of 17,500 to 18,000.
n Results Today
Century Enka | Century Textiles | Dishman Pharma. | G M D C | Gammon Infra. | GTL Infra. |
Havells India | JSW Energy | Lupin | Punj Lloyd |
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