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Jet Airways
3QFY11: In-line operating performance
„Cut PO on rising ATF prices
We have cut our EBITDAR estimates by 4%-8% for FY11-13E on account of (a)
hike in average ATF assumption by 3%-16% over FY11E-13E, (b) marginal cuts
in domestic traffic and yields over FY11E-13E. However, we have raised our
international traffic and yield assumptions by 1%-4% over FY11-13E on account
of strong demand which partially offsets the hike in ATF. To factor in the lower
EBITDAR we have cut our PO to Rs.750 (from Rs916).
3QFY11: In-line PBT; Deferred tax lowers PAT
Jet (ex-sub JetLite) reported net profit of Rs1.18bn (+12% YoY) in Q3FY11 vs.
our BofAMLe of Rs1.8bn. While EBITDAR and PBT were largely in-line with our
estimates, PAT was lower on account deferred tax of Rs1bn. Operating revenue
at Rs34.7bn (+20% YoY; 12% QoQ) was in-line with our estimate of Rs35.5bn.
EBITDAR margin at 24.5% was marginally lower than our estimate of 25%.
Subsidiary Jetlite returned back to black and made a profit of Rs. 256mn.
Business class & international exposure keep yields steady
Domestic yields for Jet were up 16% sequentially (+4.3% YoY) and on the same
lines international yields were up 3% sequentially (+8% YoY). This was largely on
account of recovery in premium traffic in both domestic and international segment.
Jet has partially shifted Jet Konnect capacity to Jet Airways full service. Going
forward higher premium capacity would enable Jet to manage their yields in a
better way in a rising crude scenario.
Attractive valuations
Jet trades at 7.2x FY12E EV/EBITDAR, largely in line with comparable regional
airlines. We value Jet at mid-cycle multiple of 8x EV/EBITDAR FY12E (same as
earlier), which is consistent with regional airlines at respective POs
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Jet Airways
3QFY11: In-line operating performance
„Cut PO on rising ATF prices
We have cut our EBITDAR estimates by 4%-8% for FY11-13E on account of (a)
hike in average ATF assumption by 3%-16% over FY11E-13E, (b) marginal cuts
in domestic traffic and yields over FY11E-13E. However, we have raised our
international traffic and yield assumptions by 1%-4% over FY11-13E on account
of strong demand which partially offsets the hike in ATF. To factor in the lower
EBITDAR we have cut our PO to Rs.750 (from Rs916).
3QFY11: In-line PBT; Deferred tax lowers PAT
Jet (ex-sub JetLite) reported net profit of Rs1.18bn (+12% YoY) in Q3FY11 vs.
our BofAMLe of Rs1.8bn. While EBITDAR and PBT were largely in-line with our
estimates, PAT was lower on account deferred tax of Rs1bn. Operating revenue
at Rs34.7bn (+20% YoY; 12% QoQ) was in-line with our estimate of Rs35.5bn.
EBITDAR margin at 24.5% was marginally lower than our estimate of 25%.
Subsidiary Jetlite returned back to black and made a profit of Rs. 256mn.
Business class & international exposure keep yields steady
Domestic yields for Jet were up 16% sequentially (+4.3% YoY) and on the same
lines international yields were up 3% sequentially (+8% YoY). This was largely on
account of recovery in premium traffic in both domestic and international segment.
Jet has partially shifted Jet Konnect capacity to Jet Airways full service. Going
forward higher premium capacity would enable Jet to manage their yields in a
better way in a rising crude scenario.
Attractive valuations
Jet trades at 7.2x FY12E EV/EBITDAR, largely in line with comparable regional
airlines. We value Jet at mid-cycle multiple of 8x EV/EBITDAR FY12E (same as
earlier), which is consistent with regional airlines at respective POs
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