Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
M u t e d p e r f o r m a n c e …
HEG’s Q2FY12 PAT was below our expectation on the back of higher cost
of domestic inputs and adverse forex movement on working capital
borrowings. The topline came at | 319.2 crore (our estimate: | 289.3 crore),
which was 6.5% higher YoY and 14.2% higher QoQ. However, on the back
of higher input costs, the EBITDA margin declined 630 bps YoY and 200
bps QoQ to 13.8%. The subsequent EBITDA stood at | 44.2 crore (our
estimate: | 55.4 crore), which was 26.6% lower YoY and flattish QoQ.
During the quarter under review, there was forex loss to the tune of | 11.55
crore. As a result, ensuing reported PAT stood at | 13.5 crore (our estimate:
| 24.7 crore), which was 54.5% lower YoY and 31.5% QoQ.
ƒ Sharp decline in EBITDA margin
During the quarter under review, there was a sharp decline in the
EBITDA margin. The EBITDA margin declined 630 bps YoY and 200
bps QoQ to 13.8%. In Q2FY12, the import price of needle coke in US
dollar terms remained stable. However, the steep depreciation of the
rupee against US dollar has led to higher landed cost of needle coke in
Q2FY12. With crude oil prices remaining at elevated levels, prices of
domestic inputs such as binder pitch, furnace oil, etc. were also
notably higher during the quarter under review.
V a l u a t i o n
At the CMP of | 205, the stock is trading at FY13E P/E of 7.5x and FY13E
EV/EBITDA of 6.2x. We have valued the stock at a 15% discount to the
global average of 6.5x CY12E EV/EBITDA, thus arriving at a target price of |
195. We have assigned a HOLD rating to the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
M u t e d p e r f o r m a n c e …
HEG’s Q2FY12 PAT was below our expectation on the back of higher cost
of domestic inputs and adverse forex movement on working capital
borrowings. The topline came at | 319.2 crore (our estimate: | 289.3 crore),
which was 6.5% higher YoY and 14.2% higher QoQ. However, on the back
of higher input costs, the EBITDA margin declined 630 bps YoY and 200
bps QoQ to 13.8%. The subsequent EBITDA stood at | 44.2 crore (our
estimate: | 55.4 crore), which was 26.6% lower YoY and flattish QoQ.
During the quarter under review, there was forex loss to the tune of | 11.55
crore. As a result, ensuing reported PAT stood at | 13.5 crore (our estimate:
| 24.7 crore), which was 54.5% lower YoY and 31.5% QoQ.
ƒ Sharp decline in EBITDA margin
During the quarter under review, there was a sharp decline in the
EBITDA margin. The EBITDA margin declined 630 bps YoY and 200
bps QoQ to 13.8%. In Q2FY12, the import price of needle coke in US
dollar terms remained stable. However, the steep depreciation of the
rupee against US dollar has led to higher landed cost of needle coke in
Q2FY12. With crude oil prices remaining at elevated levels, prices of
domestic inputs such as binder pitch, furnace oil, etc. were also
notably higher during the quarter under review.
V a l u a t i o n
At the CMP of | 205, the stock is trading at FY13E P/E of 7.5x and FY13E
EV/EBITDA of 6.2x. We have valued the stock at a 15% discount to the
global average of 6.5x CY12E EV/EBITDA, thus arriving at a target price of |
195. We have assigned a HOLD rating to the stock.
No comments:
Post a Comment