Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
ITC’s 1Q FY12 results were above our expectations −
Net sales, EBITDA and net profit rose 19.7%, 20.7%
and 24.5%, respectively.
Cigarettes posted robust volume and PBIT growth of
~8% and 21%, respectively.
Non-cigarette business’ net sales grew 22% yoy with
PBIT growth of 34%. Sales growth across businesses
was strong, except in hotels.
The substantial increase of 83% in other income helped
ITC post higher-than-expected profit of Rs13.3bn.
We believe all positives are priced-in at current FY12E
P/E of 27x. Maintain IN-LINE with revised PT of Rs210.
Robust volume and PBIT growth in cigarettes. ITC posted
strong cigarette volume growth of 8% on the back of a low-base
(4-5% decline in 1Q FY11) and no change in excise duties in
the Feb ’11 budget. PBIT growth was also strong at 20.8%, as
against street estimate of high-teens growth. Margin expanded
200bps yoy to 29.9%.
Non-cigarettes business does well – Key highlights
Non-cigarettes business maintains growth trajectory with
net sales & PBIT growth of 22% and 34%, respectively.
Other FMCG business sales growth was robust at 19.4%
yoy. However, losses increased sequentially to Rs763m.
Higher trading volume and improved realisation in soya,
wheat and coffee resulted in agri-business sales and
PBIT growth of 25.8% and 21.1%, respectively.
Hotels net sales growth was moderate at 12% but
control on operational costs led to 33% PBIT growth.
Paper & paperboards surprised positively with net sales
growth of 20.9% and PBIT growth of 20.4%.
Higher other income boosts PAT. Apart from healthy
business profits, higher other income and operating income (up
83% compared with our expectation of 30% increase) aided
strong adjusted net profit growth of 24.5% yoy.
Positives priced-in. Maintain IN-LINE. We recently
downgraded ITC to IN-LINE as we believe the stock is fully
priced at FY12 P/E of 27x. Concerns like mid-term increase in
excise, possibility of VAT increase in other southern states and
taxation overhang of FY13 will limit outperformance in the near
term, in our view. Also, note that Tamil Nadu VAT hikes are not
yet passed through to consumers and can impact FY12
margins. We roll forward to Jun ’13 EPS with a revised price
target of Rs210 (earlier Rs198) based on forward P/E of 23x.
Re-iterate IN-LINE.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
ITC’s 1Q FY12 results were above our expectations −
Net sales, EBITDA and net profit rose 19.7%, 20.7%
and 24.5%, respectively.
Cigarettes posted robust volume and PBIT growth of
~8% and 21%, respectively.
Non-cigarette business’ net sales grew 22% yoy with
PBIT growth of 34%. Sales growth across businesses
was strong, except in hotels.
The substantial increase of 83% in other income helped
ITC post higher-than-expected profit of Rs13.3bn.
We believe all positives are priced-in at current FY12E
P/E of 27x. Maintain IN-LINE with revised PT of Rs210.
Robust volume and PBIT growth in cigarettes. ITC posted
strong cigarette volume growth of 8% on the back of a low-base
(4-5% decline in 1Q FY11) and no change in excise duties in
the Feb ’11 budget. PBIT growth was also strong at 20.8%, as
against street estimate of high-teens growth. Margin expanded
200bps yoy to 29.9%.
Non-cigarettes business does well – Key highlights
Non-cigarettes business maintains growth trajectory with
net sales & PBIT growth of 22% and 34%, respectively.
Other FMCG business sales growth was robust at 19.4%
yoy. However, losses increased sequentially to Rs763m.
Higher trading volume and improved realisation in soya,
wheat and coffee resulted in agri-business sales and
PBIT growth of 25.8% and 21.1%, respectively.
Hotels net sales growth was moderate at 12% but
control on operational costs led to 33% PBIT growth.
Paper & paperboards surprised positively with net sales
growth of 20.9% and PBIT growth of 20.4%.
Higher other income boosts PAT. Apart from healthy
business profits, higher other income and operating income (up
83% compared with our expectation of 30% increase) aided
strong adjusted net profit growth of 24.5% yoy.
Positives priced-in. Maintain IN-LINE. We recently
downgraded ITC to IN-LINE as we believe the stock is fully
priced at FY12 P/E of 27x. Concerns like mid-term increase in
excise, possibility of VAT increase in other southern states and
taxation overhang of FY13 will limit outperformance in the near
term, in our view. Also, note that Tamil Nadu VAT hikes are not
yet passed through to consumers and can impact FY12
margins. We roll forward to Jun ’13 EPS with a revised price
target of Rs210 (earlier Rs198) based on forward P/E of 23x.
Re-iterate IN-LINE.
No comments:
Post a Comment