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India Equity Research Reports, IPO and Stock News
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Earnings risk mitigated
Navneet Publications– low earnings beta
The current macro risk, pose limited risk to Navneet with 60% revenues
derived from school publications. We expect topline and bottomline to
grow at CAGR of 18% and 25% respectively over FY11-13E, on the
back of curriculum changes in Maharashtra and Gujaratstate boards.
Further new initiatives like e-learning, school management business
and diversification in other states are gaining traction. Q3FY12 is
seasonally an insignificant quarter; in FY12E it contributed only 14% of
revenues. We expect topline and bottomline to grow at 16% and 15%
respectively. At 11x one year forward earnings, it looks attractive,
considering a healthy ROC of 25%, high competitive barriers and
limited revenue risk.
TTK Prestige – No sharp slowdown
There is anticipation of sharp deceleration of growth in consumer
durables space, butour channel checks with sales heads and company
management indicate brown goods have witnessed minimal impact.
We expect Q3FY12 sales to remain steady with 34% growth on YoY.
However, sharp currency movement will impact Chinese imported raw
material cost. Also the newly commenced capacities will inflate fixed
cost. In Q3FY11,TTK achieved peak EBITDA margins of 17.9%, thus on
YoY, we expect margins to dip 180bps, leading to PAT growth of 19%.
Growth of below 20% may correct stock price 10%-15%, which should
be a good level to accumulate with long term target of INR3,320.
Techno Electric and Engineering – Derisking business
Techno’s relatively healthy order book of 1.5x sales vis-à-vis peers and
diversification in wind business will stand in good stead in the current
environment. While EPC is no longer the flavour of the market,
Techno’s wind business has gained traction. The newly commenced
100MWcapacity and REC offtake at robust prices on the exchange are
positives. Over Q3FY12, the EPC is expected to report 13% revenue
growth while wind business revenue should grow at 50% considering
corporate revenues in Q1FY11.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Earnings risk mitigated
Navneet Publications– low earnings beta
The current macro risk, pose limited risk to Navneet with 60% revenues
derived from school publications. We expect topline and bottomline to
grow at CAGR of 18% and 25% respectively over FY11-13E, on the
back of curriculum changes in Maharashtra and Gujaratstate boards.
Further new initiatives like e-learning, school management business
and diversification in other states are gaining traction. Q3FY12 is
seasonally an insignificant quarter; in FY12E it contributed only 14% of
revenues. We expect topline and bottomline to grow at 16% and 15%
respectively. At 11x one year forward earnings, it looks attractive,
considering a healthy ROC of 25%, high competitive barriers and
limited revenue risk.
TTK Prestige – No sharp slowdown
There is anticipation of sharp deceleration of growth in consumer
durables space, butour channel checks with sales heads and company
management indicate brown goods have witnessed minimal impact.
We expect Q3FY12 sales to remain steady with 34% growth on YoY.
However, sharp currency movement will impact Chinese imported raw
material cost. Also the newly commenced capacities will inflate fixed
cost. In Q3FY11,TTK achieved peak EBITDA margins of 17.9%, thus on
YoY, we expect margins to dip 180bps, leading to PAT growth of 19%.
Growth of below 20% may correct stock price 10%-15%, which should
be a good level to accumulate with long term target of INR3,320.
Techno Electric and Engineering – Derisking business
Techno’s relatively healthy order book of 1.5x sales vis-à-vis peers and
diversification in wind business will stand in good stead in the current
environment. While EPC is no longer the flavour of the market,
Techno’s wind business has gained traction. The newly commenced
100MWcapacity and REC offtake at robust prices on the exchange are
positives. Over Q3FY12, the EPC is expected to report 13% revenue
growth while wind business revenue should grow at 50% considering
corporate revenues in Q1FY11.
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