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Bajaj's 4Q EBITDA growth eased to 11% yoy and flat qoq, which is just 4% better than our
estimate. EBITDA margin was 20.5%, as improved product mix helped overcome market share
pressure in 2-wheelers. With high growth behind now and segment leader Hero Honda expansion
impacting market share, Sell.
EBITDA margin maintained above 20% in 4Q
Net sales Rs.42bn, +23.5% yoy, +0.5% qoq. RBS est Rs.41.7bn
Raw material to net sales 70.9%, +160bps yoy but -50bps qoq. Sharp increase in stocks,
extended helping hand.
EBITDA margin 20.5%, -240bps yoy, +20bps qoq. RBS est 19.9%.
EBITDA Rs.9.24bn, +10.8% yoy, flat qoq. RBS est Rs.8.3bn,
Other income Rs.1.01bn, +138% yoy, +1.5% qoq. RBS est Rs910mn
PBT Rs.9.32bn +18.6% yoy, +1.6% qoq. Also up 5.7% from RBS est of Rs.8.8bn.
Tax rate at 27.6%, RBS est 30%.
Normalised PAT Rs.6.75bn, 9.4% better than RBS est of Rs.6.17bn.
Reported PAT is Rs.14bn, as extra-ordinary items boost it (Rs.8.27bn is benefit from prepayment
of sales tax loan, Rs.1bn impact from investment loss in Indonesian subsidiary).
Dividend Rs.40 per share. Cash in hand Rs. 42.4bn.
Consolidate entity reported PAT for FY11 was 3.4% higher than parent, as its associate
company KTM turns-around in FY11.
Management contact highlights
Management highlighted that the key reasons for higher employee costs (+22% qoq) are 1)
new wage agreement for its largest plant (in term of employees) Waluj and 2) performance
bonus provision for employees.
Management highlighted that it repaid Rs.12bn worth of sales tax deferral loan at present
value arrived on a discount rate of 11.4%, leading to Rs.8.27bn profit.
Exports were Rs.45.5bn in FY11 and DEPB benefit was around 9% of the exports amount.
For FY11, debtors were flat at 12 days, whereas inventory reduced to 12 days of net sales.
We await for management call, before revisiting our estimates.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Bajaj's 4Q EBITDA growth eased to 11% yoy and flat qoq, which is just 4% better than our
estimate. EBITDA margin was 20.5%, as improved product mix helped overcome market share
pressure in 2-wheelers. With high growth behind now and segment leader Hero Honda expansion
impacting market share, Sell.
EBITDA margin maintained above 20% in 4Q
Net sales Rs.42bn, +23.5% yoy, +0.5% qoq. RBS est Rs.41.7bn
Raw material to net sales 70.9%, +160bps yoy but -50bps qoq. Sharp increase in stocks,
extended helping hand.
EBITDA margin 20.5%, -240bps yoy, +20bps qoq. RBS est 19.9%.
EBITDA Rs.9.24bn, +10.8% yoy, flat qoq. RBS est Rs.8.3bn,
Other income Rs.1.01bn, +138% yoy, +1.5% qoq. RBS est Rs910mn
PBT Rs.9.32bn +18.6% yoy, +1.6% qoq. Also up 5.7% from RBS est of Rs.8.8bn.
Tax rate at 27.6%, RBS est 30%.
Normalised PAT Rs.6.75bn, 9.4% better than RBS est of Rs.6.17bn.
Reported PAT is Rs.14bn, as extra-ordinary items boost it (Rs.8.27bn is benefit from prepayment
of sales tax loan, Rs.1bn impact from investment loss in Indonesian subsidiary).
Dividend Rs.40 per share. Cash in hand Rs. 42.4bn.
Consolidate entity reported PAT for FY11 was 3.4% higher than parent, as its associate
company KTM turns-around in FY11.
Management contact highlights
Management highlighted that the key reasons for higher employee costs (+22% qoq) are 1)
new wage agreement for its largest plant (in term of employees) Waluj and 2) performance
bonus provision for employees.
Management highlighted that it repaid Rs.12bn worth of sales tax deferral loan at present
value arrived on a discount rate of 11.4%, leading to Rs.8.27bn profit.
Exports were Rs.45.5bn in FY11 and DEPB benefit was around 9% of the exports amount.
For FY11, debtors were flat at 12 days, whereas inventory reduced to 12 days of net sales.
We await for management call, before revisiting our estimates.
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