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1QFY2012 Result Review
BHEL
BHEL announced its 1QFY2012 results, which were lower than our expectations. Total
income grew by 10.2% yoy to `7,272cr (`6,601cr), which was 12% lower than our
estimate of `8,251cr. EBITDA margin for the quarter came in at 15.3%, which was slightly
ahead of our estimate. On a yoy basis, margin expanded by around 70bp. EBITDA grew
by 15% yoy to `1,113cr (`965cr) on the back of sedate growth. Segment wise, the power
segment reported muted growth of 7.6% yoy `5,780cr (`5,373cr), while the industry
segment registered decent 19% yoy growth to `1,653cr (`1,388cr). Despite sedate revenue
growth, a strong 52.2% yoy jump in other income positively impacted the numbers. This
resulted in healthy PAT growth of 22.1% yoy to `816cr (`668cr), which exceeded our
estimates of `785cr. We maintain our Neutral recommendation on the stock.
Cairn India
Cairn India announced strong set of numbers for 1QFY2012. The company’s top line
during the quarter registered growth of 341.7% yoy to `3,713cr, which was lower than our
expectation of `4,393cr. Growth was driven by higher volumes and realisations on the
back of higher sales from the Mangala field. Realisation increased to US$104.5/bbl
(+12.2% qoq). The company’s gross production from Mangala field averaged
125,127bopd (+5.9% qoq). OPM expanded by 1,184bp yoy to 85.0%, resulting in
operating profit growth of 413.2% yoy to `3,156cr during the quarter. Thus, on account of
robust top-line growth and OPM expansion during the quarter, PAT surged by 868.9% yoy
to `2,727cr above our expectation of `2,670cr.
The company would hold a postal ballot to consider the two conditions imposed by the
government of India for accepting the Cairn-Vedanta deal. The conditions are acceptance
of royalty as cost recoverable and withdrawal of arbitration process for paying cess.
We maintain our Neutral view on the stock.
Maruti Suzuki
For 1QFY2012, Maruti Suzuki (Maruti) reported 3.6% yoy (down 15.5% qoq) growth in net
sales to `8,529cr, in-line with our estimates, aided by a 4% yoy increase in average net
realisation driven by better product mix (higher contribution of diesel vehicles) and price
increases. Volume growth during the quarter remained sluggish and registered a 0.6% yoy
decline (18% qoq), impacted largely due to slowdown in demand in the small car segment
and production loss due to a 13-day strike at Manesar plant. On the operating front,
EBITDA margin was in-line with our estimates at 9.5% and almost flat on a yoy basis, but it
was down 46bp sequentially. Raw-material costs increased marginally by 12bp yoy (50bp
qoq) to 76.3% of sales, while other expenses declined by 64bp yoy, benefitting the
margins. Net profit increased by 18% yoy (down 16.8% qoq) to `549cr; 22.6% ahead of
our estimates, led by higher-than-expected other income.
At `1,178, Maruti is trading at 13.1x and 11.6x FY2012E and FY2013E earnings,
respectively. We maintain our Accumulate rating on the stock with a target price `1,323.
Asian Paints
For 1QFY2012, Asian Paints posted a strong set of numbers on the top-line and earnings
front. The top line grew by 23.5% yoy to `2,260cr (`1,830cr), marginally above our
estimates. Earnings grew by 16.5% yoy to `271cr (`233cr), above our estimates, on
account of high other income. The company has been facing margin pressure for the past
many quarters now. The company’s operating profit declined by 162bp yoy to `392cr
(`347cr) on account of high raw-material costs (up by 258bp yoy), staff costs (up 74bp
yoy) and other expenses (up 37bp yoy). The stock is currently under review.
JSW Steel
For 1QFY2012, JSW Steel posted a strong set of numbers on the top-line and earnings
front. Consolidated net sales grew by 55.5% yoy to `7,434cr, above of our estimate of
`6,448cr. Standalone net sales grew by 53.3% yoy to `7,065cr. Standalone sales growth
was driven by increased volumes (+43.9% yoy to 1.7mn tonnes) as well as blended
realisations (+6.5% yoy to `41,217/tonne). However, standalone EBITDA/tonne decreased
by 11.1% yoy to `8,132 due to higher raw-material costs. Consolidated EBITDA increased
by 26.6% yoy to `1,435cr. Other income increased by 430.6% yoy to `17cr.
Consequently, net profit increased by 46.0% yoy to `485cr, in-line with our estimate of
`489cr. We maintain Buy on the stock, while we keep our target price under review.
Alembic Pharmaceuticals
For 1QFY2012, Alembic Pharmaceuticals (Alembic) reported a good set of numbers.
The company’s top line came in at `345cr, registering 34% yoy growth. Domestic
formulations, which contribute 50% to sales, reported 19% yoy growth, while international
formulation grew by handsome 116% yoy growth. The API segment also grew by almost
27% during the quarter. With increasing proportion of formulation in the overall sales mix,
margin improved from 11.4% to 14.6% in 1QFY2012. Net profit for 1QFY2012 came in
at `27.6cr. Post the de-merger, the company is awaiting re-listing. Currently, we maintain
our target price of `71.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
1QFY2012 Result Review
BHEL
BHEL announced its 1QFY2012 results, which were lower than our expectations. Total
income grew by 10.2% yoy to `7,272cr (`6,601cr), which was 12% lower than our
estimate of `8,251cr. EBITDA margin for the quarter came in at 15.3%, which was slightly
ahead of our estimate. On a yoy basis, margin expanded by around 70bp. EBITDA grew
by 15% yoy to `1,113cr (`965cr) on the back of sedate growth. Segment wise, the power
segment reported muted growth of 7.6% yoy `5,780cr (`5,373cr), while the industry
segment registered decent 19% yoy growth to `1,653cr (`1,388cr). Despite sedate revenue
growth, a strong 52.2% yoy jump in other income positively impacted the numbers. This
resulted in healthy PAT growth of 22.1% yoy to `816cr (`668cr), which exceeded our
estimates of `785cr. We maintain our Neutral recommendation on the stock.
Cairn India
Cairn India announced strong set of numbers for 1QFY2012. The company’s top line
during the quarter registered growth of 341.7% yoy to `3,713cr, which was lower than our
expectation of `4,393cr. Growth was driven by higher volumes and realisations on the
back of higher sales from the Mangala field. Realisation increased to US$104.5/bbl
(+12.2% qoq). The company’s gross production from Mangala field averaged
125,127bopd (+5.9% qoq). OPM expanded by 1,184bp yoy to 85.0%, resulting in
operating profit growth of 413.2% yoy to `3,156cr during the quarter. Thus, on account of
robust top-line growth and OPM expansion during the quarter, PAT surged by 868.9% yoy
to `2,727cr above our expectation of `2,670cr.
The company would hold a postal ballot to consider the two conditions imposed by the
government of India for accepting the Cairn-Vedanta deal. The conditions are acceptance
of royalty as cost recoverable and withdrawal of arbitration process for paying cess.
We maintain our Neutral view on the stock.
Maruti Suzuki
For 1QFY2012, Maruti Suzuki (Maruti) reported 3.6% yoy (down 15.5% qoq) growth in net
sales to `8,529cr, in-line with our estimates, aided by a 4% yoy increase in average net
realisation driven by better product mix (higher contribution of diesel vehicles) and price
increases. Volume growth during the quarter remained sluggish and registered a 0.6% yoy
decline (18% qoq), impacted largely due to slowdown in demand in the small car segment
and production loss due to a 13-day strike at Manesar plant. On the operating front,
EBITDA margin was in-line with our estimates at 9.5% and almost flat on a yoy basis, but it
was down 46bp sequentially. Raw-material costs increased marginally by 12bp yoy (50bp
qoq) to 76.3% of sales, while other expenses declined by 64bp yoy, benefitting the
margins. Net profit increased by 18% yoy (down 16.8% qoq) to `549cr; 22.6% ahead of
our estimates, led by higher-than-expected other income.
At `1,178, Maruti is trading at 13.1x and 11.6x FY2012E and FY2013E earnings,
respectively. We maintain our Accumulate rating on the stock with a target price `1,323.
Asian Paints
For 1QFY2012, Asian Paints posted a strong set of numbers on the top-line and earnings
front. The top line grew by 23.5% yoy to `2,260cr (`1,830cr), marginally above our
estimates. Earnings grew by 16.5% yoy to `271cr (`233cr), above our estimates, on
account of high other income. The company has been facing margin pressure for the past
many quarters now. The company’s operating profit declined by 162bp yoy to `392cr
(`347cr) on account of high raw-material costs (up by 258bp yoy), staff costs (up 74bp
yoy) and other expenses (up 37bp yoy). The stock is currently under review.
JSW Steel
For 1QFY2012, JSW Steel posted a strong set of numbers on the top-line and earnings
front. Consolidated net sales grew by 55.5% yoy to `7,434cr, above of our estimate of
`6,448cr. Standalone net sales grew by 53.3% yoy to `7,065cr. Standalone sales growth
was driven by increased volumes (+43.9% yoy to 1.7mn tonnes) as well as blended
realisations (+6.5% yoy to `41,217/tonne). However, standalone EBITDA/tonne decreased
by 11.1% yoy to `8,132 due to higher raw-material costs. Consolidated EBITDA increased
by 26.6% yoy to `1,435cr. Other income increased by 430.6% yoy to `17cr.
Consequently, net profit increased by 46.0% yoy to `485cr, in-line with our estimate of
`489cr. We maintain Buy on the stock, while we keep our target price under review.
Alembic Pharmaceuticals
For 1QFY2012, Alembic Pharmaceuticals (Alembic) reported a good set of numbers.
The company’s top line came in at `345cr, registering 34% yoy growth. Domestic
formulations, which contribute 50% to sales, reported 19% yoy growth, while international
formulation grew by handsome 116% yoy growth. The API segment also grew by almost
27% during the quarter. With increasing proportion of formulation in the overall sales mix,
margin improved from 11.4% to 14.6% in 1QFY2012. Net profit for 1QFY2012 came in
at `27.6cr. Post the de-merger, the company is awaiting re-listing. Currently, we maintain
our target price of `71.
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