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KEC International
KEC International (KEC) posted a good set of results for 1QFY2012. The top line and
bottom line grew strongly, but EBITDA margin was lower than our estimates. Revenue grew
by 20.9% yoy to `1,023cr (est. `998cr), mainly on the back of strong execution. EBITDA
margin for the quarter compressed by 60bp yoy to 9.4% (est. 10.5%), which led to modest
EBITDA growth of 13.7% yoy to `96cr (`84cr). Other operating metrics viz., higher interest
cost and depreciation cost rose by 25.7% and 35.3%, respectively; however, a relatively
lower tax incidence (35.3% in 1QFY2011 vs. 46.6% in 1QFY2012) helped the bottom line
to grow by 25.4% yoy to `33cr (`26cr). We are in the process of revising our financial
estimates based on the insights provided by the management during the conference call.
We maintain our Buy recommendation on the stock. Our target price is under review.
Goodyear India Ltd. – 2QCY2011
Goodyear India announced its 2QCY2011 results. The company’s top line grew by 18.3%
to `389cr in 2QCY2011 from `329cr in 2QCY2010, in-line with our expectations, while
EBITDA margin contracted by 310bp yoy to 6.5% due to increased raw-material cost and
employee expenses. PAT dipped by 24.2% yoy to `15cr as compared to `19cr in the same
quarter last year due to higher depreciation. We expect the company’s margin to improve
on the back of recent hikes in the prices of tyres and stability in rubber prices. We revise
our target price to `426, with a target PE of 8x its CY2012E earnings, with a Buy rating on
the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
KEC International
KEC International (KEC) posted a good set of results for 1QFY2012. The top line and
bottom line grew strongly, but EBITDA margin was lower than our estimates. Revenue grew
by 20.9% yoy to `1,023cr (est. `998cr), mainly on the back of strong execution. EBITDA
margin for the quarter compressed by 60bp yoy to 9.4% (est. 10.5%), which led to modest
EBITDA growth of 13.7% yoy to `96cr (`84cr). Other operating metrics viz., higher interest
cost and depreciation cost rose by 25.7% and 35.3%, respectively; however, a relatively
lower tax incidence (35.3% in 1QFY2011 vs. 46.6% in 1QFY2012) helped the bottom line
to grow by 25.4% yoy to `33cr (`26cr). We are in the process of revising our financial
estimates based on the insights provided by the management during the conference call.
We maintain our Buy recommendation on the stock. Our target price is under review.
Goodyear India Ltd. – 2QCY2011
Goodyear India announced its 2QCY2011 results. The company’s top line grew by 18.3%
to `389cr in 2QCY2011 from `329cr in 2QCY2010, in-line with our expectations, while
EBITDA margin contracted by 310bp yoy to 6.5% due to increased raw-material cost and
employee expenses. PAT dipped by 24.2% yoy to `15cr as compared to `19cr in the same
quarter last year due to higher depreciation. We expect the company’s margin to improve
on the back of recent hikes in the prices of tyres and stability in rubber prices. We revise
our target price to `426, with a target PE of 8x its CY2012E earnings, with a Buy rating on
the stock.
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