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I n t e r n a t i o n a l s a l e s d r i v e r e v e n u e g r o w t h …
Nitin Fire Protection Industries Ltd’s (NFPIL) Q1FY12 results witnessed a
robust increase in topline to | 161.5 crore against | 89.7 crore in Q1FY11
led by a significant increase in international sales. Margins also improved
~220 bps to 16.5% over 14.3% in Q1FY11. Margin improvement was led
by the company’s rationalisation of other expenses and marginal savings
in employee cost though the raw material cost pressure continued during
the quarter. Other manufacturing expenses were lower by ~380 bps
while employee expenses were lower by ~20 bps to 3.0% and 2.7% of
net sales, respectively. Consequent to the higher sales and margins,
earnings during the quarter jumped to | 23.6 crore over | 9.6 crore in the
corresponding quarter last year.
ƒ Standalone performance review
On a standard basis, sales grew 8.2% to | 29.3 crore vs. | 27.1 crore in
Q1FY11. Though raw material cost to sales was lower at 71.7% vs. 73.5%
in Q1FY11, standard employee cost and other manufacturing expenses
were comparatively higher at 4.5% (higher by 120 bps YoY) and 6.2%
(higher by 70 bps YoY), respectively. Hence, margins were sustained at
17.6% vs. 17.8% in Q1FY11. Earnings during the quarter stayed in line
with that of the corresponding quarter last year at | 3.3 crore.
ƒ Sales break-up
During the quarter, NFPIL’s domestic sales witnessed growth of 32.2% to
| 42.1 crore from | 31.8 crore in Q1FY11. Comparatively, the growth in
the international business was robust at ~106% to | 119.3 crore over |
57.9 crore in the corresponding quarter last year.
V a l u a t i o n
At the CMP, the stock is trading at 9.1x and 8.3x its FY12E and FY13E EPS
of | 12.2 and | 13.3, respectively. With strong growth in the fire fighting
segment, increasing sales volumes of CNG cylinders overseas and higher
realisations of CNG cylinders, we believe the company would continue to
witness robust revenue growth. The stock had run up before the results
and we believe it is fairly valued at the CMP. We have valued the stock at
9x its FY12E EPS of | 12.2 with a target price | 112 and HOLD rating
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
I n t e r n a t i o n a l s a l e s d r i v e r e v e n u e g r o w t h …
Nitin Fire Protection Industries Ltd’s (NFPIL) Q1FY12 results witnessed a
robust increase in topline to | 161.5 crore against | 89.7 crore in Q1FY11
led by a significant increase in international sales. Margins also improved
~220 bps to 16.5% over 14.3% in Q1FY11. Margin improvement was led
by the company’s rationalisation of other expenses and marginal savings
in employee cost though the raw material cost pressure continued during
the quarter. Other manufacturing expenses were lower by ~380 bps
while employee expenses were lower by ~20 bps to 3.0% and 2.7% of
net sales, respectively. Consequent to the higher sales and margins,
earnings during the quarter jumped to | 23.6 crore over | 9.6 crore in the
corresponding quarter last year.
ƒ Standalone performance review
On a standard basis, sales grew 8.2% to | 29.3 crore vs. | 27.1 crore in
Q1FY11. Though raw material cost to sales was lower at 71.7% vs. 73.5%
in Q1FY11, standard employee cost and other manufacturing expenses
were comparatively higher at 4.5% (higher by 120 bps YoY) and 6.2%
(higher by 70 bps YoY), respectively. Hence, margins were sustained at
17.6% vs. 17.8% in Q1FY11. Earnings during the quarter stayed in line
with that of the corresponding quarter last year at | 3.3 crore.
ƒ Sales break-up
During the quarter, NFPIL’s domestic sales witnessed growth of 32.2% to
| 42.1 crore from | 31.8 crore in Q1FY11. Comparatively, the growth in
the international business was robust at ~106% to | 119.3 crore over |
57.9 crore in the corresponding quarter last year.
V a l u a t i o n
At the CMP, the stock is trading at 9.1x and 8.3x its FY12E and FY13E EPS
of | 12.2 and | 13.3, respectively. With strong growth in the fire fighting
segment, increasing sales volumes of CNG cylinders overseas and higher
realisations of CNG cylinders, we believe the company would continue to
witness robust revenue growth. The stock had run up before the results
and we believe it is fairly valued at the CMP. We have valued the stock at
9x its FY12E EPS of | 12.2 with a target price | 112 and HOLD rating
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