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CCCL posted a mixed set of numbers for the quarter. The company’s revenue
came in-line with our expectations, but the company gave a positive surprise at
the EBITDA level, which led to higher-than-expected profit for the quarter. CCCL
had an order inflow of `403cr during the quarter, taking the order inflow for
FY2012 to `3,114cr. The order book currently stands at `5,916cr (2.8x FY2012
revenue). We recommend Neutral on the stock.
Positive surprise at the EBITDAM level: The company’s top line declined by 8.4%
yoy to `589cr, against our estimate of `572cr. Segment wise, the commercial
segment has contributed 54% to the company’s revenue, followed by the
infrastructure (23%), industrial (19%) and the balance by residential and building
products segments. However, the positive surprise came on the margin front, as
the company posted significantly higher-than-expected EBITDA margin of 9.5%,
a jump of 600bp/490bp on a yoy/qoq basis, against our expectation of 4.4%.
The main reason for margin improvement was lower cost of material and
subcontracting charges as a percentage of sales. Interest cost came in at `29cr,
a jump of 142.8%/59.4% on a yoy/qoq basis. On the bottom-line front, the
company posted profit of `25cr in 4QFY2012 vs. `2cr in 4QFY2011, against
our expectation of `1cr profit mainly on account of margin improvement.
Outlook and valuation: CCCL has been posting erratic numbers on the EBITDAM
front and consequently has been performing poorly on the earnings front as well
since the past few quarters. Slow-moving orders (`1,622cr, 27% of order book)
and poor EBITDAM performance expected for another 3-4 quarters would result
in subdued performance from CCCL going forward as well. Further, high interest
cost would result in earnings pressure in the near future. We maintain our
Neutral view on the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
CCCL posted a mixed set of numbers for the quarter. The company’s revenue
came in-line with our expectations, but the company gave a positive surprise at
the EBITDA level, which led to higher-than-expected profit for the quarter. CCCL
had an order inflow of `403cr during the quarter, taking the order inflow for
FY2012 to `3,114cr. The order book currently stands at `5,916cr (2.8x FY2012
revenue). We recommend Neutral on the stock.
Positive surprise at the EBITDAM level: The company’s top line declined by 8.4%
yoy to `589cr, against our estimate of `572cr. Segment wise, the commercial
segment has contributed 54% to the company’s revenue, followed by the
infrastructure (23%), industrial (19%) and the balance by residential and building
products segments. However, the positive surprise came on the margin front, as
the company posted significantly higher-than-expected EBITDA margin of 9.5%,
a jump of 600bp/490bp on a yoy/qoq basis, against our expectation of 4.4%.
The main reason for margin improvement was lower cost of material and
subcontracting charges as a percentage of sales. Interest cost came in at `29cr,
a jump of 142.8%/59.4% on a yoy/qoq basis. On the bottom-line front, the
company posted profit of `25cr in 4QFY2012 vs. `2cr in 4QFY2011, against
our expectation of `1cr profit mainly on account of margin improvement.
Outlook and valuation: CCCL has been posting erratic numbers on the EBITDAM
front and consequently has been performing poorly on the earnings front as well
since the past few quarters. Slow-moving orders (`1,622cr, 27% of order book)
and poor EBITDAM performance expected for another 3-4 quarters would result
in subdued performance from CCCL going forward as well. Further, high interest
cost would result in earnings pressure in the near future. We maintain our
Neutral view on the stock.
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