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Rain Commodities' (RCOL) 1QCY12 consolidated adjusted PAT increased 3% QoQ to INR1.8b (v/s our estimate
of INR1.6b). Net sales declined 10% QoQ to INR14.6b, in-line with our estimate of INR14.4b. Reported PAT was
boosted by forex gain of USD169m (v/s loss of USD294m in 4QCY11).
EBITDA was flat QoQ at INR3.7b (estimate: INR3.3b) as the carbon business continued to deliver superior
margins with calculated EBITDA/ton at USD97 (down 6% QoQ). EBITDA/ton for cement improved 24% QoQ to
INR844/ton.
Total carbon volumes (CPC and pet coke) increased 6% QoQ to 701kt, while cement volumes improved 15%
QoQ to 604kt.
RCOL's gross debt has now come down to USD679m (from USD709m in 4QCY11) on account of reduction in both
term debt (USD625m to USD610m) and working capital debt (USD85m to USD69m). Net debt declined by
USD79m QoQ to USD463m. Net D/E ratio fell to 1.1x and is expected to decline further to 0.9x by 4QCY12.
Interest charges declined 13% QoQ to INR582m on account of lower debt levels.
The company completed the buyback of 10m shares at an aggregate amount of INR319.9m.
Current valuations are (2x CY12E EPS and 2.8x CY12E EV/EBITDA) are attractive. We believe RCOL's business
remains strong and the stock offers superior risk-return ratio. We expect stock to get rerated on further deleveraging.
Re-iterate Buy with target price of INR89/share.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Rain Commodities' (RCOL) 1QCY12 consolidated adjusted PAT increased 3% QoQ to INR1.8b (v/s our estimate
of INR1.6b). Net sales declined 10% QoQ to INR14.6b, in-line with our estimate of INR14.4b. Reported PAT was
boosted by forex gain of USD169m (v/s loss of USD294m in 4QCY11).
EBITDA was flat QoQ at INR3.7b (estimate: INR3.3b) as the carbon business continued to deliver superior
margins with calculated EBITDA/ton at USD97 (down 6% QoQ). EBITDA/ton for cement improved 24% QoQ to
INR844/ton.
Total carbon volumes (CPC and pet coke) increased 6% QoQ to 701kt, while cement volumes improved 15%
QoQ to 604kt.
RCOL's gross debt has now come down to USD679m (from USD709m in 4QCY11) on account of reduction in both
term debt (USD625m to USD610m) and working capital debt (USD85m to USD69m). Net debt declined by
USD79m QoQ to USD463m. Net D/E ratio fell to 1.1x and is expected to decline further to 0.9x by 4QCY12.
Interest charges declined 13% QoQ to INR582m on account of lower debt levels.
The company completed the buyback of 10m shares at an aggregate amount of INR319.9m.
Current valuations are (2x CY12E EPS and 2.8x CY12E EV/EBITDA) are attractive. We believe RCOL's business
remains strong and the stock offers superior risk-return ratio. We expect stock to get rerated on further deleveraging.
Re-iterate Buy with target price of INR89/share.
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