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JBF Industries: BOPET films deliver a stellar performance…
JBF Industries’ (JBF) Q3FY11 results were well ahead of the street and our
estimates on the back of a superior performance in the BOPET films
segment. Standalone net sales increased 41% YoY to | 845 crore lower
than our estimated | 1054.2 crore on the back of a lower volume and
value growth in the textile grade chips segment. It reported a standalone
EBITDA margin of 13.4% (up 131 bps and 195 bps QoQ and YoY,
respectively). PAT growth was relatively muted at 16.9% YoY to | 29.8
crore lower than our estimated | 55.2 crore due to a forex loss of | 34.3
crore. A 62.9% and 16.8% increase in BOPET films and pet chips
realisation respectively, led to a YoY growth of 44.0% and 192.1% in
consolidated net sales and EBITDA respectively. Consolidated PAT grew
by over six times to | 185.6 crore.
ƒ BOPET Films segment leads the growth
JBF delivered a strong performance on a consolidated level led by
the BOPET films division at Ras-Al-Khaima (RAK). While realisations
improved 37% QoQ, the input costs increased by only 16% leading
to an EBITDA margin expansion of 180 bps QoQ to 17.7%.
ƒ Capacity addition to aid growth in FY12
JBF is expanding its chips capacity at the RAK unit from 3,60,000
tonnes per annum (TPA) to 4,30,000 TPA by end of FY11. It is also
expanding the films capacity (at the RAK unit) by 30,000 TPA to
96,000. This is likely to be completed by December 2011. This will
further aid revenue and profitability growth in FY12.
Valuation
JBF has reported a strong growth in the last three quarters aided by
realisation growth. JBF is well poised to reap the benefits of the expanded
capacities and cater to the increasing demand for chips, POY and films
(thick and thin). The management opines that the current realisations
might hold for a couple of quarters before they normalise. Owing to a
stellar performance we have revised our estimates upwards. JBF is
currently trading at 2.5x FY12E EPS of | 70.4. Our revised target price
works out to | 236 (based on an average of 4.5x FY12E EPS and 0.60x
FY12E book value). We have a STRONG BUY rating on the stock.
In Q3FY11, consolidated net sales increased 44.0% to | 1,711.8 crore. A
62.9% increase in BOPET films’ realisation led to a strong growth in
EBITDA. The EBITDA margin more than doubled from 8.7% in Q3FY10 to
17.7% in Q3FY11. PAT grew over six times to | 185.6 crore on the back of
increased sales and operating margins
Considering the strong growth in realisations and a strong outlook for
prices of finished products we have revised our estimates for FY11E and
FY12E. Our revised revenue estimates stand at | 6,080.7 crore and |
6,835.0 crore for FY11E and FY12E respectively. The EBITDA margin and
PAT estimates stand at 15.6% and 15.0%, and | 481.2 crore and | 500.7
crore for FY11E and FY12E, respectively. As a result, EPS for FY11E and
FY12E stand at | 67.6 and | 70.4, respectively.
Valuations
JBF has reported a strong growth in the last three quarters aided by
realisation growth. JBF is well poised to reap the benefits of the expanded
capacities and cater to the increasing demand for chips, POY and films
(thick and thin). The management opines that the current realisations
might hold for a couple of quarters before they normalise. Owing to a
stellar performance we have revised our estimates upwards. JBF is
currently trading at 2.5x FY12E EPS of | 70.4. Our revised target price
works out to | 236 (based on an average of 4.5x FY12E EPS and 0.60x
FY12E book value). We have a STRONG BUY rating on the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
JBF Industries: BOPET films deliver a stellar performance…
JBF Industries’ (JBF) Q3FY11 results were well ahead of the street and our
estimates on the back of a superior performance in the BOPET films
segment. Standalone net sales increased 41% YoY to | 845 crore lower
than our estimated | 1054.2 crore on the back of a lower volume and
value growth in the textile grade chips segment. It reported a standalone
EBITDA margin of 13.4% (up 131 bps and 195 bps QoQ and YoY,
respectively). PAT growth was relatively muted at 16.9% YoY to | 29.8
crore lower than our estimated | 55.2 crore due to a forex loss of | 34.3
crore. A 62.9% and 16.8% increase in BOPET films and pet chips
realisation respectively, led to a YoY growth of 44.0% and 192.1% in
consolidated net sales and EBITDA respectively. Consolidated PAT grew
by over six times to | 185.6 crore.
ƒ BOPET Films segment leads the growth
JBF delivered a strong performance on a consolidated level led by
the BOPET films division at Ras-Al-Khaima (RAK). While realisations
improved 37% QoQ, the input costs increased by only 16% leading
to an EBITDA margin expansion of 180 bps QoQ to 17.7%.
ƒ Capacity addition to aid growth in FY12
JBF is expanding its chips capacity at the RAK unit from 3,60,000
tonnes per annum (TPA) to 4,30,000 TPA by end of FY11. It is also
expanding the films capacity (at the RAK unit) by 30,000 TPA to
96,000. This is likely to be completed by December 2011. This will
further aid revenue and profitability growth in FY12.
Valuation
JBF has reported a strong growth in the last three quarters aided by
realisation growth. JBF is well poised to reap the benefits of the expanded
capacities and cater to the increasing demand for chips, POY and films
(thick and thin). The management opines that the current realisations
might hold for a couple of quarters before they normalise. Owing to a
stellar performance we have revised our estimates upwards. JBF is
currently trading at 2.5x FY12E EPS of | 70.4. Our revised target price
works out to | 236 (based on an average of 4.5x FY12E EPS and 0.60x
FY12E book value). We have a STRONG BUY rating on the stock.
In Q3FY11, consolidated net sales increased 44.0% to | 1,711.8 crore. A
62.9% increase in BOPET films’ realisation led to a strong growth in
EBITDA. The EBITDA margin more than doubled from 8.7% in Q3FY10 to
17.7% in Q3FY11. PAT grew over six times to | 185.6 crore on the back of
increased sales and operating margins
Considering the strong growth in realisations and a strong outlook for
prices of finished products we have revised our estimates for FY11E and
FY12E. Our revised revenue estimates stand at | 6,080.7 crore and |
6,835.0 crore for FY11E and FY12E respectively. The EBITDA margin and
PAT estimates stand at 15.6% and 15.0%, and | 481.2 crore and | 500.7
crore for FY11E and FY12E, respectively. As a result, EPS for FY11E and
FY12E stand at | 67.6 and | 70.4, respectively.
Valuations
JBF has reported a strong growth in the last three quarters aided by
realisation growth. JBF is well poised to reap the benefits of the expanded
capacities and cater to the increasing demand for chips, POY and films
(thick and thin). The management opines that the current realisations
might hold for a couple of quarters before they normalise. Owing to a
stellar performance we have revised our estimates upwards. JBF is
currently trading at 2.5x FY12E EPS of | 70.4. Our revised target price
works out to | 236 (based on an average of 4.5x FY12E EPS and 0.60x
FY12E book value). We have a STRONG BUY rating on the stock.
Uflex Ltd. has been producing a variety of value added flexible plastic packaging material , sophisticated product films like BOPET, BOPP and CPP, state-of-the-art packaging and converting machines, rotogravure cylinders, thereby providing world class flexible packaging solutions to its customers in both the domestic and international market at competitive prices.
ReplyDeleteI am extremely impressed with your writing skills and also with the layout on your blog.Uflex Ltd. is committed to reduce carbon footprint by aiming on biodegradable packaging materials which diffuse quickly and cleanly. With its motto ‘Tomorrow’s packaging using today’s waste,’ Uflex believes that wherever possible all flexible packaging should be re-cycled in the same industry.
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