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CG reported consol PAT of Rs1.17bn (down ~45% YoY), well below our and
street est. of ~Rs1.44bn (implying 32% de-growth). Reported topline of
Rs27.1bn (up 12.8%) was marginally ahead of our estimate (Rs26.8bn),
however margins fell over 550bps to 8.4%, ~100bps below estimates.
Operating income de-grew 32% YoY. Higher depreciation and tax rate
(28.1% vs. 27% est.) contributed to the bottom-line disappointment. CG was
down over 14% post results. Entering into Sep-q results we note that our
current FY13 EPS est. of Rs11.8 is 15% below Bloomberg consensus.
Standalone revenues practically flat. CG reported standalone revenue of
Rs14.5bn, up only 0.5% YoY. The domestic power segment revenues (and
exports out of India) were down 7% YoY. For a consecutive quarter
consumer segment revenue grew by low single digits (3.6% YoY). At the
consolidated level revenue was in-line on account of exceptionally high
growth in overseas subsidiary revenue (31.6% YoY) and industry segment
(29% YoY vs. our est. of 23% growth). The favorable INR/EUR movement
appears to have contributed to overseas power segment topline growth, in our
view.
Sep-q margins down 550bps. Margin disappointment (~100bps) was led by
higher RM (up 630bps), especially so in case of overseas subsidiaries (EBIT
margin of 2.3%). Both consumer and industry segment reported a decline of
150-250bps in EBIT margins on a QoQ basis.
Analyst meet tomorrow at 10:15am to be addressed by Mr. Demortier
(MD), a novelty. There appears to be a departure from the norm of doing
conference calls post results. We expect to get more clarity on order inflows,
growth and margin outlook for FY13, where we see investor focus shifting.
Maintain UW, Mar-12 DCF based PT of Rs125. The promoter had bought
0.5% stake from open market in Sep-q which had supported brief rally in
stock ahead of results, in our view. Pick up in order inflows and management
commentary tomorrow is a potential upside risk.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
CG reported consol PAT of Rs1.17bn (down ~45% YoY), well below our and
street est. of ~Rs1.44bn (implying 32% de-growth). Reported topline of
Rs27.1bn (up 12.8%) was marginally ahead of our estimate (Rs26.8bn),
however margins fell over 550bps to 8.4%, ~100bps below estimates.
Operating income de-grew 32% YoY. Higher depreciation and tax rate
(28.1% vs. 27% est.) contributed to the bottom-line disappointment. CG was
down over 14% post results. Entering into Sep-q results we note that our
current FY13 EPS est. of Rs11.8 is 15% below Bloomberg consensus.
Standalone revenues practically flat. CG reported standalone revenue of
Rs14.5bn, up only 0.5% YoY. The domestic power segment revenues (and
exports out of India) were down 7% YoY. For a consecutive quarter
consumer segment revenue grew by low single digits (3.6% YoY). At the
consolidated level revenue was in-line on account of exceptionally high
growth in overseas subsidiary revenue (31.6% YoY) and industry segment
(29% YoY vs. our est. of 23% growth). The favorable INR/EUR movement
appears to have contributed to overseas power segment topline growth, in our
view.
Sep-q margins down 550bps. Margin disappointment (~100bps) was led by
higher RM (up 630bps), especially so in case of overseas subsidiaries (EBIT
margin of 2.3%). Both consumer and industry segment reported a decline of
150-250bps in EBIT margins on a QoQ basis.
Analyst meet tomorrow at 10:15am to be addressed by Mr. Demortier
(MD), a novelty. There appears to be a departure from the norm of doing
conference calls post results. We expect to get more clarity on order inflows,
growth and margin outlook for FY13, where we see investor focus shifting.
Maintain UW, Mar-12 DCF based PT of Rs125. The promoter had bought
0.5% stake from open market in Sep-q which had supported brief rally in
stock ahead of results, in our view. Pick up in order inflows and management
commentary tomorrow is a potential upside risk.
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