| Bata India - Insti | - Bata India’s (BIL) net revenue for 2QFY16 grew by a mere 5% to Rs5,754mn, 2.7%/4.0% below our/Bloomberg consensus estimates, respectively, because of weak demand, supply chain problems and likely market share loss to e-commerce players. Gross margin declined 115bps to 53%, despite lower crude oil prices because of higher discounts to liquidate inventory. Weak sales growth, higher-than-expected rental costs (4% above expectations and up 135bps YoY as a percentage of sales) and higher other expenses (12% above expectations and up 100bps YoY as a percentage of sales) led operating margin to decline 308bps YoY to 8.5%, 267bps/344bps below our/Bloomberg consensus estimates, respectively. Following weak revenue growth as well as operating margin, Ebitda declined 22.9% to Rs491mn,25.9%/31.6% below our/Bloomberg consensus estimates, respectively. Reported PAT grew 38.7% to Rs541mn, but excluding exceptional gain of Rs317.5mn in bottom-line, adjusted PAT declined 24.7% to Rs294mn, 24.2%/29.5% below our/Bloomberg consensus estimates, respectively. Considering weak demand and internal problems, the management aims to increase BIL’s revenue by 50% in the next four years, a mere 10.7% CAGR. Following a lower growth rate and weak margin because of higher opex, we have cut our FY16/FY17 EBITDA and net profit estimates sharply by 19.7%/15.1 and 22.4%/11.6%, respectively. Given the lack of clarity on critical matters like implementation of SAP/ERP systems, ramp-up of ecommerce business, and steps taken to improve product quality, etc., we have cut our FY17 P/E multiple to 27.0x from 30.0x,marginally below the seven-year average of 28.4x. We believe the structural story and long-term opportunity is huge in BIL. We expect the re-entry of old board members as a positive development, but it will take a significant time for their actions to get converted into growth and profitability. We have retained Accumulate rating on BIL with a revised target price of Rs461 (Rs580 earlier) based on 27x/15.7x FY17E P/E and EV/EBITDA, respectively.
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| Cognizant - Insti | - Cognizant Technology Solutions (Cognizant) reported another stellar quarter (3QCY15) with a sequential revenue growth of 3.3%, beating its own guidance by a good US$45mn. For the third consecutive quarter, the company raised its guidance on revenue as well as earnings for CY15. We believe the new guidance factors in organic revenue growth of ~14.8%. (ex-Trizetto acquisition). This growth is likely to be at least 500bps higher than the best performing company in the Tier-1 India set for FY16/CY15. However, on 2016 growth, we believe the management commentary was a bit subdued. There was talk of ‘law of large numbers’ and possible slower growth in the ‘healthcare’ vertical because of M&A activity. Healthcare had a sizable 30% contribution to revenue in 3Q. The 3.3% QoQ revenue growth was underpinned by a 4.6% growth in its consulting division, while outsourcing (where business is akin to India-listed peers) grew just 1.5%. Consulting to outsourcing split was 58:42. Non-GAAP operating margin was reported at 19.4%, which was within the stated margin band of 19%-20%. The management made some interesting points regarding the pricing in ‘traditional services’. It pointed out that some India-based players are making ‘irrational pricing assumptions’ on the back of automation while bidding for these services. It sounded sceptical regarding these assumptions. If the assumptions are indeed unrealistic they could result in either margin dilution for these players or dissatisfactory services to clients.
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| IFB Industries - Insti | - We hosted the conference-call of IFB Industries (IFB) on 4 November 2015 to discuss its 2QFY16 financial performance. IFB was represented by Mr. Probir Chatterjee – executive director and chief financial officer, Mr. Rajshankar Ray - chief executive officer – home appliances, and Mr. Arup Das, head of marketing- engineering division. We expect IFB to maintain more than a 20% revenue CAGR and improve its margins from the current level over the next three to five years. To account for increase in expenses because of launch of new products, we have cut our EBITDA estimates by 11.4%/7.1% for FY16/FY17, respectively. Improvement in operating margin likely by 140bps over FY15-FY17E coupled with strong revenue/net profit CAGR of 19.4%/33.8%, respectively, during the same period led by top-loading washing machines whose manufacturing commenced in 4QFY15, launch of new models in air-conditioners, refrigerators etc, rise in market share, moderation in capex, debt-free balance sheet, strong free cash flow generation of Rs1.06bn and a 763bps improvement in RoIC likely from 11.8% in FY15 to 19.4% in FY17E are expected to drive the valuation. IFB stock trades attractively at 22.3x/12.6x FY17E P/E and EV/EBITDA, respectively.
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| P&G Hygiene and Healthcare - Insti | - P&G Hygiene and Healthcare or P&GHH’s sales growth at 4% YoY in 1QFY16 was well below expectations. Despite the feminine hygiene segment growing in double-digits, a decline in the healthcare segment’s sales because of a weak monsoon led to disappointment. Gross margin was up 343bps YoY, well above our estimate of a 10bps improvement. Advertisement and promotion or A&P spending had declined by an unusually high level in base quarter 1QFY15. EBITDA was 4.2% above expectations and PAT 0.8% above expectations as gross margin improvement and lower A&P led to a 247bps YoY EBITDA margin improvement. Changes to our estimates resulted in 2.0%/2.4% decrease in our EPS estimates for FY16/FY17, respectively, as we are more conservative going forward on the revenue growth front. We remain strong believers in the structural revenue growth story of P&GHH led by low market penetration in the feminine hygiene segment (accounting for two-thirds of its sales) at around 15% and barriers to entry in the form of rising distribution reach which will benefit both key segments - feminine hygiene and healthcare- phenomenal category development efforts and widest product portfolio compared to peers. We believe the company can report ~20% EPS CAGR on a steady-state basis for many more years and, therefore, deserves high P/E multiple. The stock is fairly valued at 42.8x FY17E EPS. We have retained our target multiple of 43x, marginally below the three-year average forward P/E as well as Accumulate rating on the stock with a revised target price of Rs6,284 (Rs6,432 earlier), up 1% from the current market price.
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| Minda Corporation | - result Improved Sales came at 610cr vs qoq 521cr yoy 480cr EBITDA came at 58.5cr vs qoq 47.2cr yoy 45.4cr PAT came at 24.7cr vs qoq 19cr yoy 21.73cr Qtr Eps is Rs.1.18
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| Sadbhav Eng | - result marginally ahead of Exp Sales came at 746cr vs Exp 704cr qoq 829cr yoy 595cr EBITDA came at 80cr vs Exp 74cr qoq 89cr yoy 60cr PAT came at 34cr vs Exp 24cr qoq 39cr yoy 10cr
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| Gujarat Borosil | |
| Reliance Infra | - Result improved Sales came at 4378cr vs qoq 4266cr yoy 4035cr EBITDA came at 832cr vs qoq 748cr yoy 724cr PAT came at 451cr vs qoq 401cr yoy 431cr Lower growth in PAt as compared to EBITDA on YoY basis is on account of higher Interest. EBIT margin improved in Power EPC and Cement business
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| Birla Corporation Ltd | - Result is marginal above expectation
- Sales came at 801.8cr vs Exp 767.6 qoq 773.5cr yoy 767.1cr
- EBITDA came at 62cr vs Exp 59.2cr qoq 57.9cr yoy 74cr
- PAT came at 18.5cr vs Exp 35.2cr qoq 16.6cr yoy 32.5cr
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| Engineers India | - Results improved. Sales came at 450 as against expectation of 386 vs 391 qoq cr vs yoy 391 . EBITDA came at 54 as against expectation of 40vs qoq 28.4vs yoy8. PAT came at 69.5 as against expectation of 64 vs qoq 57 vs yoy of 59
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| Voltamp | |
| Fortis Healthcare | - result ahead of Expectation
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| Morepen Lab | - result improved Sales came at 109cr vs qoq 99cr yoy 87cr EBITDA came at 16cr vs qoq 13,5cr yoy 10.3cr PAT came at 3.22cr vs qoq 2.5cr yoy 0.3cr Qtr EPS is Rs. 0.07
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| PPAP Automotive | - Result improved Sales came at 80cr vs qoq 72cr yoy 75cr EBITDA came at 14.7cr vs qoq 12.2cr yoy 10.9cr PAT came at 4.5cr vs qoq 2.97cr yoy 2.5cr Qtr EPS is Rs.3,25
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| Indag Rubber | - result improved Sales came at 71cr vs qoq 64cr yoy 58cr EBITDA came at 12.3cr qoq 11.55cr yoy 10.28cr PAT came at 8.61cr vs qoq 8.03cr yoy 8.76cr Qtr EPS is Rs. 3.29
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| Honda Siel | - result improved Sales came at 147cr vs yoy 127cr qoq 150cr EBITDA came at 15.9cr vs yoy 10cr qoq 19.13cr PAT came at 8.62cr vs yoy 4.6cr qoq 10.9cr Qtr EPS is 8.52 Share is trading at 27 PE trailing EPS
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| Sterling tool | - result improved . Sales came at 95.08 cr vs qoq 83.2cr vs yoy 82.7 cr. EBITDA came at 17.03 cr vs qoq 14.12cr vs yoy 11.23 cr. PAT came at 8.3 cr vs qoq 6.06 cr vs yoy 4.82cr.
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| Pricol | - result improved . Sales came at 245.5 cr vs qoq 217.4cr vs yoy 224.7 cr. EBITDA came at 13.59 cr vs qoq 11.9cr vs yoy 11.0cr. PAT came at 2.77 cr vs qoq 1.64 cr vs yoy adj 0.73cr.
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| PNC Infra | - results were Ok. Sales came at 537vs 505 qoq cr vs yoy 377.EBITDA came at 85vs qoq 85 vs yoy 70 .PAT came at 18vs qoq 24vs yoy 22
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| Ujaas Energy | - results were Ok. Sales came at 53 vs 12 qoq cr vs yoy 29.EBITDA came at 12.4 vs qoq 10.2 vs yoy 10 .PAT came at 3.3vs qoq 1.4vs yoy 1.8.
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| National Peroxide | |
| Garden Silk | |
| Magma Fincorp | |
| Bodal Chemicals | |
| Fortis Healthcare | - Result is good
- Sales is Rs 1084 cr vs exp of Rs 1103 cr. QoQ Rs 1040 cr YoY Rs 1018 cr
- EBITDA is Rs 72.8 cr vs exp of Rs 63.6 cr. QoQ Rs 50.5 cr YoY Rs 13.6 cr
- Adjusted PAT is Rs 13.4 cr vs exp of Rs 7 cr. QoQ Rs 3.6 cr YoY loss of Rs 56.5 cr
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| Coral Labs | |
| Voltamp transformers | - results improved Sales came at 133cr vs 87cr qoq cr vs yoy 135cr .EBITDA came at 5.5cr vs qoq 2.5cr vs yoy 2.5cr .PAT came at 6.8cr vs qoq 6.4cr vs yoy 5cr. Qtr EPS is Rs.6.7. and share is trading at PE of 26x on Q2 annualised earning
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| Styrolution | - results declining Sales came at 287vs 313 qoq cr vs yoy 274.EBITDA came at 18 vs qoq 34 vs yoy 18 .PAT came at 9 vs qoq 18vs yoy 8
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| Intrasoft technologies | - result ok . Sales came at 153.97 cr vs qoq 117.7cr vs yoy 59.6 cr. EBITDA came at 1.74 cr vs qoq 0.80 cr vs yoy 0.64 cr. PAT came at 1.14 cr vs qoq 1.22 cr vs yoy 0.92cr.
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| Accelya kale | - result ok. Sales came at 79.77 cr vs qoq 75.06cr vs yoy 73.55 cr. EBITDA came at 26.77 cr vs qoq 27.6 cr vs yoy 27.59 cr. PAT came at 16.4 cr vs qoq 14.06 cr vs yoy 17.80cr.
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| Ashok Leyland | - Result marginally below expectation Sales came at 4879cr vs Exp 5192cr qoq 3775cr yoy 3150cr EBITDA came at 594cr vs Exp 618cr qoq 389cr yoy 234cr. Margin came at 12,17% vs Exp 11.9% PAT came at 290cr vs Exp 327cr qoq 159cr yoy 42cr
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| Indotech Transformer | - results were Ok. Sales came at 54 vs 42 qoq cr vs yoy 36 . EBITDA loss came at 3.5vs qoq EBIDTA loss 4.3 vs yoy EBIDTA loss of 3. Loss came at 4.4 vs qoq profit of 0.8 vs yoy loss of 0.2
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| Indo Tech Transformer | |
| Greenlam Ind | - results were Ok. Sales came at 222 vs 208qoq..EBITDA came at 30vs qoq 25. Profit came at 9.2vs qoq 6.4. Qtr EPS is Rs. 3.82 and share is trading at PE of 27.6x on Q2 annualised earning
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| IDBI | - result ok NII came at 1611cr vs qoq 1494 yoy 1406cr PBP came at 1518cr vs qoq 1138cr yoy 1197cr Provision came at 1289cr vs qoq 879cr yoy 990 PAT came at 119cr vs qoq 135cr yoy 118cr GNPA came at 14757cr vs qoq 14112cr yoy 11559cr
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| Honeywell | - Result ok Sales came at 509cr vs qoq 512cr yoy 512cr EBITDA came at 58cr vs qoq 57cr yoy 48cr PAT came at 41cr vs qoq 37cr yoy 30cr
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| Manali Petro | - Result ok Sales came at 171cr vs qoq 169cr yoy 191cr EBITDA came at 23.5cr vs qoq 21,7cr yoy 20.cr PAT came at 16.6cr vs qoq 14.7 yoy 13cr Qtr EPS is Rs.0.96
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| Repco Home Finance | - Result ok NII came at 74cr vs Exp 72 qoq 66 yoy 59cr PBP came at 65cr vs Exp 63cr qoq 58cr yoy 52cr Provision came at 5cr vs qoq 11cr yoy 2cr PAT came at 39cr vs Exp 39cr qoq 30cr yoy 33cr
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| Sunshield Chemical | |
| TVS Electronic | |
| Neyveli Lignite | - Result ok Sales came at 1716cr vs qoq 1843cr yoy 1402cr EBITDA came at 610cr vs qoq 633cr yoy 344cr PAT came at 343cr vs qoq 366cr yoy 259cr
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| JK Lakshmi Cement | - Result inline
- Sales came at 645.7cr vs Exp 621 qoq 590.8cr yoy 572.6cr
- EBITDA came at 66.7cr vs Exp 67.6cr qoq 50.7cr yoy 89.2cr
- Loss came at 15cr vs Exp loss of 10.6cr qoq loss of 23.5cr yoy 30.6cr
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| Vaibhav Global | - Result declining. Sales came at 298cr vs yoy 321cr declined 7% qoq 276cr EBITDA came at 19cr vs yoy 38.2cr qoq 14.7cr EBITDA margin got impacted on account of operational inefficiency PAT came at 12.11cr vs yoy 24.9cr qoq 7.3cr Qtr EPS is Rs.3.73cr. Company was changing its business model to fight the competition and for that all the changes has been done in this quarter. The effect of the same will be monitored in coming quarter and will drive the stock.
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| Usha Martin Ltd | - Result is below expectation
- Sales came at 1013cr vs Exp 1060.4 qoq 1067.8cr yoy 1158cr
- EBITDA came at 53.4cr vs Exp 106.4cr qoq 123.6cr yoy 193.4cr
- Loss came at 99.2cr vs Exp loss of 80.2cr qoq loss of 73.2cr yoy loss of 65.3cr
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| Garware Polyester | |
| Marico | - Result is below expectations
- Sales is Rs 1483 cr vs exp of Rs 1600 cr. QoQ Rs 1781 cr YoY Rs 1429 cr
- EBITDA is Rs 230 cr vs exp of rs 249 cr. QoQ rs 325 cr YoY rs 195 cr
- PAT is Rs 150.7 cr vs exp of Rs 160 cr. QoQ Rs 238 cr YoY rs 118 cr
- The company has announced 1:1 bonus
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| Godrej Properties | - results below Expectation. Sales came at 1444 as against expectation of 1153 vs 164 qoq cr vs yoy 286 .EBITDA came at 165cr as against expectation 265 vs qoq 55 vs yoy 56. Profit came at 106 as against expectation of 141vs qoq 55 vs yoy 47crSuzuki Japan raise guidance on back of strong India unit (Maruti Suzuki) earnings expectations
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| Whirlpool | - Result below expectation Sales came at 678cr vs Exp 828cr qoq 1068cr yoy 709cr EBITDA came at 58cr vs Exp 72cr qoq 150cr yoy 64cr PAT came at 38cr vs Exp 51cr qoq 98cr yoy 41cr
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| JB Chemical | - Result marginally below expectation Sales came at 281cr vs Exp 304cr qoq 279cr yoy 275cr EBITDA came at 54cr vs Exp 60cr qoq 51cr yoy 58cr PAT came higher at 49cr vs Exp 35cr qoq 34cr yoy 32cr Higher PAt is on account of higher Other income
- The stock is trading at 18x on FY16E earnings
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| Sanghi Industries ltds | - Result is declining
- Sales came at 216.3cr vs qoq 262.5cr yoy 179cr
- EBITDA came at 25.6cr vs qoq 36.9cr yoy 33.2cr
- PAT came at 2.3cr vs qoq 0.3cr yoy 1.8cr
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| Bank of Maharashtra | - Result declining GNPA came at 7986cr vs qoq 7575cr yoy 4351cr NII came at 970cr vs qoq 1023cr yoy 992cr PBP came at 614cr vs qoq 610cr yoy 588cr Provision came at 419cr vs qoq 484cr yoy 293cr PAT came at 72cr vs qoq 59cr yoy 163cr
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| Sparc | - Result is declining
- Sales is Rs 43 cr vs QoQ Rs 43.4 cr YoY Rs 46 cr
- Net loss is Rs 17.7 cr vs QOQ loss of Rs 1.7 cr YoY loss of Rs 1.5 cr
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| Canara Bank | - Below expectation
- Net interest income is Rs2646.5 cr vs. QoQ Rs2517 cr and YoY Rs 2368 cr.
- PPOP is Rs1944.1 cr vs. QoQ Rs 2004 cr and YoY Rs1626 cr.
- PAT is Rs 528.9 cr vs. QoQ Rs 479 cr and YoY Rs627 cr.
- Gross NPAs and Net NPAs have increased 7.2% and 5.5 Q-o-Q during the quarter. Gross NPAs and Net NPAs stand at 4.3% and 2.9% respectively with 33% PCR. Operationally weak quarter.
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| OCL India Ltd | - Result is below expectation
- Sales came at 531.9cr vs Exp 560.9 qoq 675.9cr yoy 469.3cr
- EBITDA came at 74.6cr vs Exp 93.5cr qoq 132.6cr yoy 57.2cr
- PAT came at 15.9cr vs Exp 24.3cr qoq 48.8cr yoy 12.7cr
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| Ratnamani Metals and Tubes | - Result is below expectation
- Sales came at 398.8cr vs Exp 449.4 qoq 417.4cr yoy 420.6cr
- EBITDA came at 57.7cr vs Exp 78.9cr qoq 88.3cr yoy 85.4cr
- PAT came at 32.4cr vs Exp 48.2cr qoq 49.9cr yoy 49.2cr
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| Vardhman Textile | - result below expectation Sales came at 1375cr vs Exp 1468cr vs qoq 1386cr yoy 1487cr EBITDA came at 270cr vs Exp 308cr qoq 293cr yoy 262cr PAt cmae higher at 159cr vs Exp 121cr qoq 148cr yoy 92cr on account of higher other income and lower tax Qtr EPS is Rs.25
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| Sadbhav Infra Project | |
