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Banks: NHB removes pre-payment penalty on floating rate home loans
[Manish Karwa]
In terms of earnings impact this might not be material for HFCs as fee earned
from pre-payment penalty is very small. Overall fees for HDFC are about 5-6% of
pre-tax income and we believe that the fees from pre-payment penalty should not
be more than 2%. For LICHF, also this should be negligible. Further, lenders could
try and offset the loss on this account by increasing other charges like loan
processing fee, which would further reduce the earnings impact.
YES Bank: 2QFY12 results: Focus on margins; growth moderates [Manish
Shukla]
NIM improves; profitability continues to be strong Yes Bank's focus appears to be
more on margins, even as it moderates its overall growth. During the quarter,
asset growth was through investments rather than loans, as the bank
concentrated on bonds/CPs. A fast repricing of loans at higher rates enabled the
bank to improve its NIM by 10bps to 2.9%, despite a relatively low CASA of 11%
and a high interest rate environment. Asset quality remains in check and
profitability in terms of RoA (1.6%) and RoE (22.6%) continues to bestrong. We
maintain Buy, underpinned by the upside implied by our INR360 TP.
Cairn India: Pipeline constraint to slow oil production ramp-up [Harshad
Katkar]
Cairn India (CAIL) in the Q2FY12 results conference call said that the production
ramp-up in Rajasthan block to 175k bpd will be delayed to Q4FY12 and further
increase is likely beyond CY12. We have therefore reduced our production
estimate for FY12 by 10% to 133k bopd. The company also indicated that capex of
US$300m has not been considered for cost recovery from Rajasthan field cash
flows.
Bajaj Auto Limited: 2QFY12: Good results, no surprises [Srinivas Rao]
Bajaj's 2QFY12 results are marginally better than our expectations. While revenues
at Rs 52.7bn (+21% YoY) were in line, EBITDA at Rs 10.6bn (+18% YoY) was 5%
ahead of our forecasts.
UltraTech Cement: Inventory drawdown in monsoon quarter !
[Chockalingam Narayanan]
UltraTech cement 2Q PAT at INR 2.79 bn were well below both street as well as
our expectations. While the actual numbers showed a strong jump on YoY basis
the disappointment was largely on higher than estimated cost on raw materials
and other expenditure.
Exide Industries Ltd: 2QFY12: Poor mix rather than weak profits is the key
concern [Amyn Pirani]
Exide's 2QFY12 results are poor. Our prime concern from the results is the lack of
improvement in the Replacement-to-OEM ratio for automotive batteries.
Biocon: Despite weak INR, high base lead to lackluster 2Q [Abhay Shanbhag]
21% yoy rev. growth: All numbers exclude Axicorp (low-margin trading German
sub) post its divestment at start of 1Q. Weak INR partly drove the 21% rev.
Thermax Limited: Strong Q2FY12 result likely driven by products sales [Anup
Kulkarni]
Thermax Q2FY12 results were a positive surprise in terms of revenue recognition
and net income, though order inflow growth fell short of last year's high base.
Visit http://indiaer.blogspot.com/ for complete details �� ��
Banks: NHB removes pre-payment penalty on floating rate home loans
[Manish Karwa]
In terms of earnings impact this might not be material for HFCs as fee earned
from pre-payment penalty is very small. Overall fees for HDFC are about 5-6% of
pre-tax income and we believe that the fees from pre-payment penalty should not
be more than 2%. For LICHF, also this should be negligible. Further, lenders could
try and offset the loss on this account by increasing other charges like loan
processing fee, which would further reduce the earnings impact.
YES Bank: 2QFY12 results: Focus on margins; growth moderates [Manish
Shukla]
NIM improves; profitability continues to be strong Yes Bank's focus appears to be
more on margins, even as it moderates its overall growth. During the quarter,
asset growth was through investments rather than loans, as the bank
concentrated on bonds/CPs. A fast repricing of loans at higher rates enabled the
bank to improve its NIM by 10bps to 2.9%, despite a relatively low CASA of 11%
and a high interest rate environment. Asset quality remains in check and
profitability in terms of RoA (1.6%) and RoE (22.6%) continues to bestrong. We
maintain Buy, underpinned by the upside implied by our INR360 TP.
Cairn India: Pipeline constraint to slow oil production ramp-up [Harshad
Katkar]
Cairn India (CAIL) in the Q2FY12 results conference call said that the production
ramp-up in Rajasthan block to 175k bpd will be delayed to Q4FY12 and further
increase is likely beyond CY12. We have therefore reduced our production
estimate for FY12 by 10% to 133k bopd. The company also indicated that capex of
US$300m has not been considered for cost recovery from Rajasthan field cash
flows.
Bajaj Auto Limited: 2QFY12: Good results, no surprises [Srinivas Rao]
Bajaj's 2QFY12 results are marginally better than our expectations. While revenues
at Rs 52.7bn (+21% YoY) were in line, EBITDA at Rs 10.6bn (+18% YoY) was 5%
ahead of our forecasts.
UltraTech Cement: Inventory drawdown in monsoon quarter !
[Chockalingam Narayanan]
UltraTech cement 2Q PAT at INR 2.79 bn were well below both street as well as
our expectations. While the actual numbers showed a strong jump on YoY basis
the disappointment was largely on higher than estimated cost on raw materials
and other expenditure.
Exide Industries Ltd: 2QFY12: Poor mix rather than weak profits is the key
concern [Amyn Pirani]
Exide's 2QFY12 results are poor. Our prime concern from the results is the lack of
improvement in the Replacement-to-OEM ratio for automotive batteries.
Biocon: Despite weak INR, high base lead to lackluster 2Q [Abhay Shanbhag]
21% yoy rev. growth: All numbers exclude Axicorp (low-margin trading German
sub) post its divestment at start of 1Q. Weak INR partly drove the 21% rev.
Thermax Limited: Strong Q2FY12 result likely driven by products sales [Anup
Kulkarni]
Thermax Q2FY12 results were a positive surprise in terms of revenue recognition
and net income, though order inflow growth fell short of last year's high base.
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