Result Update: , Eicher Motors Ltd, Sun Pharma, Motherson Sumi Systems Ltd, State Bank of India :: Emkay

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Eicher Motors Ltd Reco: HOLD CMP: Rs 1,705 Target Price: Rs 1,915 Mixed bag, Downgrade to HOLD ·      EBIDTA at 1.5bn (4% below est). APAT at Rs 854mn (in line). CV business surprised positively, while two wheeler performance was below est. ·      Waiting list for two wheelers continues despite capacity increase. Strong CV performance will be driven by expansion in HD ·      Fine tune CY12 est. by -2% to Rs 137.8. Introduce CY13 with EPS of Rs 161. See downside risk to vol. est. due to macro environment/capacity constraints ·      Downgrade to HOLD with a TP of Rs 1,915 (current business value – Rs 1,762, NPV of engine business – Rs 153). Key triggers – faster capacity addition of two wheelers

Sun Pharma Reco: ACCUMULATE CMP: Rs 552 Target Price: Rs 586 Strong Performance - Maintain Accumulate ·      Sun Pharma’s Q3FY12 results - Revenues at Rs21bn (up 34% YoY), EBITDA at Rs9.6bn (up 119% YoY) and RPAT at Rs6.6bn (up 91% YoY) ·      Strong performance was led by 63% growth in US which was driven by ramp-up in market share of recently launched products, increase in selling prices of select products in Taro and INR dep. Domestic biz grew 17% ·      Going forward in FY13E, growth will be driven by Para-IV launch of Lexapro, Plavix, Eloxatin and Stalevo in US and continued momentum in domestic biz ·      With strong traction from US market and a stable domestic business – we maintain Accumulate rating with a revised target price of Rs586 at 21x FY13E EPS of Rs28

Motherson Sumi Systems Ltd Reco: ACCUMULATE CMP: Rs 174 Target Price: Rs 210 In line, Retain ACCUMULATE ·      EBIDTA at Rs 2.6bn was in line (est. Rs 2.5bn). APAT at Rs 1.2bn was above est. of Rs 885mn due to lower tax rate. SMR reports 150bps QoQ margins expansion with higher utilization ·      Peguform reports Sales/Adj. EBITDA/APAT of Rs11.5bn/Rs 43mn/ Rs -156mn for 38 days. Peguform to be EPS accretive but not assigning value due to limited information ·      Concerns with Debt overdone. Net Debt (ex Peguform) is Rs 16bn (marginally up QoQ).  Of the total gross debt of Rs 29bn of Peguform, debt attributable to MSSL is only Rs 11bn ·      Retain ACCUMULATE with a TP of Rs 210.  SMR margins to further improve with increase in utilization. Major benefit visible from 2QFY13

State Bank of India Reco: HOLD CMP: Rs 2,129 Target Price: Rs 1,950 Slippages remain higher; capital infusion inadequate ·      SBI Q3FY12 – NII at Rs114bn ahead of estimates aided by higher loan growth and strong NIM at 4.1%. However, with lower other inc, PAT at Rs32.6bn came in line with our est ·      Asset quality continues to disappoint with gross slippages at Rs81bn (3.6% ann). Further, despite equity infusion, Net NPL / networth would stand at high 20%+ for FY12 ·      Loan growth at 7% qoq came in as a surprise. With 3% qoq growth in deposits, LDR inched 330bps qoq to 85%. Mgmt guided for 16% yoy loan growth for FY12 ·      Capital infusion + plough back of PAT would raise tier I CAR to 9%.  Also, with lower accretion in net slippages, pressure on asset quality to ease. Upgrade to Hold with PT of 1,950