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Nitin Fire : International sales to drive topline…
Nitin Fire reported its Q3FY11 results. The company’s topline during the
quarter grew 11% to | 109 crore against | 98.2 crore in Q3FY10. The
growth was mainly on account of the increase in international sales that
grew ~16% to | 89.6 crore. Margins, however, dipped significantly by
593 bps to 11.9% in Q3FY11 against 17.8% in the corresponding quarter
last year. The pull down was due to higher employee cost that rose
~121% to | 5.7 crore. Also, depreciation was higher by ~110% to | 1.7
crore against | 0.9 crore in Q3FY10. In spite of lower EBITDA margins,
the earnings inched up ~38% to | 19.3 crore led by a substantial
increase in other income to | 14.4 crore against | 1 crore in the
corresponding quarter last year.
ƒ Operational Highlights
Sales from international operations grew 15.7% to | 89.6 crore
against | 77.4 crore in Q3FY10. However, sales from the domestic
business witnessed a dip of around 7% to | 19.4 crore against | 20.8
crore in the corresponding quarter. However, going ahead, we
believe the company’s revenues from both India and international
operations would improve led by increasing crude prices
(~$90/barrel) that would drive demand for CNG cylinders.
Valuations
At the current market price of | 62, the stock is trading at 8.6x and 7x its
FY11 and FY12 estimated EPS of | 7.2 and | 8.9, respectively. With crude
price trending upwards, we expect the demand for CNG cylinders to
improve in both the domestic and international markets, hence driving
revenues. However, the only concern would be efficient management of
rising input costs, which the company would pass on to consumers. We
are maintaining our ADD rating on the stock, valuing it at 8x its FY12E
EPS of | 8.9 and have arrived at a target price of | 67.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Nitin Fire : International sales to drive topline…
Nitin Fire reported its Q3FY11 results. The company’s topline during the
quarter grew 11% to | 109 crore against | 98.2 crore in Q3FY10. The
growth was mainly on account of the increase in international sales that
grew ~16% to | 89.6 crore. Margins, however, dipped significantly by
593 bps to 11.9% in Q3FY11 against 17.8% in the corresponding quarter
last year. The pull down was due to higher employee cost that rose
~121% to | 5.7 crore. Also, depreciation was higher by ~110% to | 1.7
crore against | 0.9 crore in Q3FY10. In spite of lower EBITDA margins,
the earnings inched up ~38% to | 19.3 crore led by a substantial
increase in other income to | 14.4 crore against | 1 crore in the
corresponding quarter last year.
ƒ Operational Highlights
Sales from international operations grew 15.7% to | 89.6 crore
against | 77.4 crore in Q3FY10. However, sales from the domestic
business witnessed a dip of around 7% to | 19.4 crore against | 20.8
crore in the corresponding quarter. However, going ahead, we
believe the company’s revenues from both India and international
operations would improve led by increasing crude prices
(~$90/barrel) that would drive demand for CNG cylinders.
Valuations
At the current market price of | 62, the stock is trading at 8.6x and 7x its
FY11 and FY12 estimated EPS of | 7.2 and | 8.9, respectively. With crude
price trending upwards, we expect the demand for CNG cylinders to
improve in both the domestic and international markets, hence driving
revenues. However, the only concern would be efficient management of
rising input costs, which the company would pass on to consumers. We
are maintaining our ADD rating on the stock, valuing it at 8x its FY12E
EPS of | 8.9 and have arrived at a target price of | 67.
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