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P e r f o r m a n c e i m p r o v e s s e q u e n t i a l l y …
JBF Industries Ltd’s (JBF) Q2FY12 numbers were in line with our
estimates. Consolidated net sales increased by 31.3% YoY to | 1,852.0
crore, marginally higher than our estimate of | 1,782.9 crore. While
volumes remained flattish (2.8% YoY growth in domestic and 1.7% YoY
de-growth in international volumes), domestic realisation growth aided
topline growth. Average domestic realisation increased by 25-30% YoY
while international realisations increased by 40.4% YoY. The EBITDA
margin at 11.4% was higher than our expectation by 90 bps. Despite a
better-than-expected operational performance and lower-than-expected
interest cost, PAT came in marginally lower than our estimates due to
higher-than-expected forex losses. Forex losses increased over five fold
from | 12.2 crore in Q2FY11 to | 63.0 crore in Q2FY12 (increased from |
45.4 crore in Q1FY12 as well). Consequently, PAT de-grew by 25.5% YoY
to | 76.0 crore (I-direct estimate: | 80.7 crore). For H1FY12, sales
increased 21.9% YoY to | 3,442.6 crore but EBITDA and PAT de-grew
3.6% and 18.2% YoY to | 372.5 and | 128.3 crore, respectively.
ƒ Capacity addition on track
During Q2FY12, JBF has increased its chips capacity at RAK from
4,20,000 MT to 4,32,000 MT. Also, the work on setting up the
purified terephthalic acid (PTA) plant at Mangalore SEZ is on track.
The land for the same has been allotted. Further, the debottlenecking of the Indian chips capacity will enhance the capacity
from 6,08,800 MT to 6,26,000 MT. JBF is also planning some
addition in the films capacity (RAK), which will take the total film
capacity to 1,02,000 MT by December 2011 (currently – 66,240 MT).
V a l u a t i o n
JBF is currently trading at 2.5x and 1.8x FY12E and FY13E EPS,
respectively. We believe it will not be possible for the company to repeat
the exceptional performance of FY11 and the same is reflected in the
share price. However, the current valuations are compelling and we
reiterate our BUY rating on the stock with a target price of | 154 (based
on an average of 3.0x FY13E EPS of | 63.5 and 0.4x FY13E book value of
| 295.6).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
P e r f o r m a n c e i m p r o v e s s e q u e n t i a l l y …
JBF Industries Ltd’s (JBF) Q2FY12 numbers were in line with our
estimates. Consolidated net sales increased by 31.3% YoY to | 1,852.0
crore, marginally higher than our estimate of | 1,782.9 crore. While
volumes remained flattish (2.8% YoY growth in domestic and 1.7% YoY
de-growth in international volumes), domestic realisation growth aided
topline growth. Average domestic realisation increased by 25-30% YoY
while international realisations increased by 40.4% YoY. The EBITDA
margin at 11.4% was higher than our expectation by 90 bps. Despite a
better-than-expected operational performance and lower-than-expected
interest cost, PAT came in marginally lower than our estimates due to
higher-than-expected forex losses. Forex losses increased over five fold
from | 12.2 crore in Q2FY11 to | 63.0 crore in Q2FY12 (increased from |
45.4 crore in Q1FY12 as well). Consequently, PAT de-grew by 25.5% YoY
to | 76.0 crore (I-direct estimate: | 80.7 crore). For H1FY12, sales
increased 21.9% YoY to | 3,442.6 crore but EBITDA and PAT de-grew
3.6% and 18.2% YoY to | 372.5 and | 128.3 crore, respectively.
ƒ Capacity addition on track
During Q2FY12, JBF has increased its chips capacity at RAK from
4,20,000 MT to 4,32,000 MT. Also, the work on setting up the
purified terephthalic acid (PTA) plant at Mangalore SEZ is on track.
The land for the same has been allotted. Further, the debottlenecking of the Indian chips capacity will enhance the capacity
from 6,08,800 MT to 6,26,000 MT. JBF is also planning some
addition in the films capacity (RAK), which will take the total film
capacity to 1,02,000 MT by December 2011 (currently – 66,240 MT).
V a l u a t i o n
JBF is currently trading at 2.5x and 1.8x FY12E and FY13E EPS,
respectively. We believe it will not be possible for the company to repeat
the exceptional performance of FY11 and the same is reflected in the
share price. However, the current valuations are compelling and we
reiterate our BUY rating on the stock with a target price of | 154 (based
on an average of 3.0x FY13E EPS of | 63.5 and 0.4x FY13E book value of
| 295.6).
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