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E r r a t i c s h o r t - t e r m m a r ke t s p o i l s t h e s h o w …
PTC India reported a disappointing set of Q3FY12 numbers as volume degrowth of 22% YoY was below our expectations of 11% YoY growth.
Hence, the volumes traded for Q3FY12 stood at 4.6 billion units (BUs) (Idirect estimate: 6.5 BUs). Sales stood at | 1330 crore vs. our expectation
of | 2343 crore. Core trading margins in Q3FY12 stood at 4 paisa (I-direct
estimate: 4.5 paisa) whereas the same stood at 4.5 paisa for H1FY12.
Similarly, PAT declined 75% YoY and 72% QoQ as a 47% QoQ rise in
interest costs and 70% QoQ fall in treasury income impacted the same.
ƒ Erratic short term market volumes disturb operational performance
For Q3FY12, volumes in the short-term market have declined by 48%
QoQ given the company has stopped trading with SEBs like Tamil Nadu
and Uttar Pradesh as | 1100 crore of dues are still pending from the
SEBs. On the other hand, volumes from long-term PPAs and cross border
trades stood at 123.3 million units (MUs) and 106.4 MUs, respectively.
Core trading margins for Q3FY12 stood at 4 paisa/unit whereas
realisations per unit stood at | 2.9/unit.
ƒ Negative sentiments of SEBs to lead to decline in volumes
Rising risk perception of non payment of dues from SEBs (deteriorating
financial health) will impact the short-term volumes, in our view. The
management expects flattish volumes for FY12. For FY13E, we have
reduced our estimates of trading volumes by 25% to 29 BUs. Coupled
with this, we have reduced our treasury income estimates, which will lead
to a decline in PAT estimates for FY12 and FY13 by 21% and 22%,
respectively.
V a l u a t i o n
In line with the reduction in our PAT estimates for FY12 and FY13, we
have reduced our target price to | 62/share (| 80 earlier) to incorporate
the fall in trading volumes and treasury income. We believe that until
clarity on SEB dues emerges, the stock will languish till such time.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
E r r a t i c s h o r t - t e r m m a r ke t s p o i l s t h e s h o w …
PTC India reported a disappointing set of Q3FY12 numbers as volume degrowth of 22% YoY was below our expectations of 11% YoY growth.
Hence, the volumes traded for Q3FY12 stood at 4.6 billion units (BUs) (Idirect estimate: 6.5 BUs). Sales stood at | 1330 crore vs. our expectation
of | 2343 crore. Core trading margins in Q3FY12 stood at 4 paisa (I-direct
estimate: 4.5 paisa) whereas the same stood at 4.5 paisa for H1FY12.
Similarly, PAT declined 75% YoY and 72% QoQ as a 47% QoQ rise in
interest costs and 70% QoQ fall in treasury income impacted the same.
ƒ Erratic short term market volumes disturb operational performance
For Q3FY12, volumes in the short-term market have declined by 48%
QoQ given the company has stopped trading with SEBs like Tamil Nadu
and Uttar Pradesh as | 1100 crore of dues are still pending from the
SEBs. On the other hand, volumes from long-term PPAs and cross border
trades stood at 123.3 million units (MUs) and 106.4 MUs, respectively.
Core trading margins for Q3FY12 stood at 4 paisa/unit whereas
realisations per unit stood at | 2.9/unit.
ƒ Negative sentiments of SEBs to lead to decline in volumes
Rising risk perception of non payment of dues from SEBs (deteriorating
financial health) will impact the short-term volumes, in our view. The
management expects flattish volumes for FY12. For FY13E, we have
reduced our estimates of trading volumes by 25% to 29 BUs. Coupled
with this, we have reduced our treasury income estimates, which will lead
to a decline in PAT estimates for FY12 and FY13 by 21% and 22%,
respectively.
V a l u a t i o n
In line with the reduction in our PAT estimates for FY12 and FY13, we
have reduced our target price to | 62/share (| 80 earlier) to incorporate
the fall in trading volumes and treasury income. We believe that until
clarity on SEB dues emerges, the stock will languish till such time.
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