Leading Equity Brokerage Houses
Wednesday, February 27, 2008
Here is a segment-wise breakup of India's leading equity brokerage houses.The revenue streams of equity broking firms are undergoing changes, against the background of growing business opportunities and diversified financial services. The major sources of revenue from major players are tabulated below.
Equity Trading:
Brics Securities 85%
Ashika Stock Broking 85%
Motilal Oswal 80%
Arihant Capital Markets 79%
Dalal & Broacha 70%
A F N Langrana Shares 70%
K R Choksey 70%
Zen Securities 65%
Indiabulls 60%
Derivatives Trading:
India Advantage Securities 87%
Crimson Financial 80%
Dolat Capital 60%
Kantilal Chhaganlal 59%
Kunvarji Finstock 59%
R Wadiwala 43%
Angel Broking 43%
Margin Financing
Anand Rathi 8%
Indiabulls 7%
Reliance Money 6%
K R Choksey 4%
Motilal Oswal 3%
E-Broking - Online Trading Marketshare in India
Indiabulls Securities Limited 451,611 clients.
Reliance Money Limited 215678
Motilal Oswal Securities Limited 19065
Unicon Financial Intermediaries Private Limited 13787
Angel Broking Limited 11828
Asit C Mehta Investment Intermediates Limited 9748
SMC Global Securities Limited 7704
Anand Rathi Securities Limited 6793
Doha Brokerage & Financial services Limited 6400
Networth Stock Broking Limited 6120
Bonanza Portfolio Limited 2977
Arihant Capital Markets Limited 2726
Mansukh Securities & Finance Limited 2500
Emkay Share & Stock Brokers Limited 2147
SKI Capital Services Limited 2000
Alankit Assignments Limited 2000
Published by DalalStreet Business @ 12:25 PM
Railway Budget Impact on Industry
IMPACT ON STEEL INDUSTRY - A DEMAND BOOSTER
We expect the steel industry to be positively impacted because of the significant capex initiatives laid down by the budget. The target for construction of broad gauge lines in 2008-09 is 3500 km (against 2300 km this year). Target for new lines is 350 km at an outlay of Rs.17 bn, gauge conversion - 2,150 km at a capex of Rs.25 bn, doubling of tracks - 1000 km at a capex of Rs.36 bn. The investments are to be directed towards developing the New Delhi, Chhatrapati Shivaji Terminus, Mumbai, Patna and Secunderabad railway stations (Rs.150 bn capex outlay on these stations), setting up diesel loco, electric loco and rail coach factory at an estimated cost of Rs.40 bn, and towards container trains, container depot and multi-modal logistics parks (Rs.20 bn).
Stainless Steel and Ferro Alloys to be the major beneficiaries.22.9 tons axle load stainless steel wagons will be manufactured from 2008-09 instead of manufacture of 20.3 tons axle load BCN and BOXN wagons.
IMPACT ON FIRE PROTECTION EQUIPMENT INDUSTRY
The Railway Budget has proposed to set up on pilot project basis installation of fire detection, prevention and protection devices. Once this project is successful it would be implemented on all the coaches. This could translate into potential business of Rs.7 bn.
Nitin Fire protection is the leading player in this area and if the project is successful it would stand to benefit significantly.
IMPACT ON LOGISTICS INDUSTRY
Construction of the dedicated rail freight corridor to commence in FY09. Setting up terminals on railway land. Focus on port connectivity. Wagon leasing and investment policy. With a lot of thrust on increased freight traffic, availability of container depots near railways stations and commencement of work on dedicated freight corridor the Railway Budget is positive for companies like Concor and Gateway Distriparks.
IMPACT ON CEMENT INDUSTRY
Increased loading target of 200 MT from cement industry by 2011-12. No across the board increase in freight rates. Reduction in freight rate for fly ash by 14%.
IMPACT ON CAPITAL GOODS INDUSTRY
Procurement of rolling stock. Indian Rail Bijli Company Ltd, a JV with NTPC to set up 1000 MW thermal power plant at Nabinagar, Bihar. MUTP Phase II to be started at a cost of Rs.50 bn, financed jointly by Railways and State Government of Maharashtra, with multi-lateral funding. Among likely beneficiaries would be Siemens India, which has received several orders for propulsion systems, traction motors and other electrical equipment under the "Mumbai Rail Vikas Corp".
Published by DalalStreet Business @ 11:49 AM
Bajaj Auto Skids out of NIFTY
State owned Power Grid Corporation of India [PGCIL] will replace Bajaj Auto in the National Stock Exchange of India's benchmark NIFTY-50. This is a very prestigious entry for PGCIL.
The PGCIL stock has shot up 9% to trade at Rs 112.00
Published by DalalStreet Business @ 10:11 AM
SEAMEC Result Analysis
Friday, February 22, 2008Q4CY2007 results of SEAMEC have been disappointing. The revenues declined by 64% year on year (yoy) to Rs22.3 crore from Rs61.6 crore due to lesser deployment of vessels. The company suffered a net loss of Rs15.9 crore during the quarter as against the net profit of Rs25.9 crore during Q4CY2006 on account of lower revenue generation and higher dry docking expenses.
During the quarter, SEAMEC III was the only vessel that was fully deployed, while SEAMEC II and SEAMEC IV were not operational due to up-gradation or repair work for longer duration than expected. SEAMEC I was also under-utilised due to premature termination of contract.
SEAMEC II to be out of operations for a minimum of six-month duration and delay in up-gradation of SEAMEC IV, we expect the company's performance to suffer during H1CY2008.
Published by DalalStreet Business @ 11:32 AM
Amtek Auto enters MOU with American Railcar
Delhi based Amtek Auto has informed us that the company has entered in to an MOU with the aim to set up a 50/50 joint venture with American Railcar industries, a North American leader in railcar manufacturing.
The signing of MOU is part of the Amtek Auto strategy to diversify by the setting up of the company's Amtek Transportations systems division and this joint venture will be part of that new division which signals a major investment by the Amtek into this new and exciting market. The transportation division, which includes railways, aerospace and surface transportation system, will have within the next 4-5 years growth to around Rs 1,500 crore in sales and will give a good balance for the Amtek with it already highly successful automotive division. Amtek is currently investigating other potential opportunities and acquisition for the transportation division both in USA and European markets.
Published by DalalStreet Business @ 11:30 AM
Bajaj Auto Demerger Details
Wednesday, February 20, 2008The Bombay High court has approved the scheme of demerger - which splits BJAT into three entities: Bajaj Auto Limited, Bajaj Holdings and Investment Ltd and Bajaj Finserve Ltd. BJA stated in a filing with the exchange that the 'effective date' and 'record date' are yet to be fixed.
Bajaj Auto will demerge its businesses into three entities
a) Bajaj Auto Ltd. (auto businesses + Rs15bn in cash);
b) Bajaj Finserve Ltd. (windpower projects, investments in the insurance ventures, investment in Bajaj Auto Finance and Rs8bn in cash);
c) Bajaj Holdings and Investment Ltd (residual cash, investment in ICICI and 30% stake in both Bajaj Auto and Bajaj Finserve).
All current shareholders of Bajaj Auto will get 1 share each of the new businesses (for every 1 share held in Bajaj Auto).
Published by DalalStreet Business @ 10:00 AM
HBL Power System Limited
Tuesday, February 19, 2008We have just received the results of HBL Power. Here is a quick look and analysis on the same.
For Q3FY08, it has reported Revenues of Rs.288.6 crore compared to Rs.121.9 crore in the same period last year, a 137% growth on YoY basis and 11% growth on QoQ basis. It has reported EBIDTA of Rs.51.9 crore compared to Rs.18.3 crore last year, a growth of 183%. Growth in PAT is even more impressive at 279% as its PAT stood at Rs.27.7 crore in Q3FY08 from Rs.7.3 crore in Q3FY07. EBIDTA Margin improved to 18% in Q3FY08 from 11.2% in Q2FY08 and 15.1% in Q3FY07. On QoQ basis, EBIDTA margin expanded by 680 basis points, mainly due to lower raw material (lead) prices.
In last 3-4 months, price of 2 key raw materials have fallen by more than 30-35% from its peak in October, which has resulted in improved situation on raw material as a percentage to sales.
Published by DalalStreet Business @ 1:31 PM
United Phosphorus acquires Evofarms Group
United Phosphorus Ltd (UPL) has informed us that the company has purchased 100% stake through its subsidiary of Evofarms group of Companies (Evofarms), a major marketing company of generic products in the crop protection industry headquartered in Bogota, Colombia. The share purchase includes all stocks, products registrations and all other property rights associated with the business of Evofarms.
Evofarms has several product registrations in Colombia and has a distribution network covering over 100 customers. It is an all cash offer and UPL will fund this through its cash accrual. After considerable growth both organically and through acquisitions in the USA, Argentina, Europe, and in India, UPL had been actively pursuing opportunities for growth in Latin America. Evofarms represents UPL's first acquisition in the Andean Region which is an interesting & fast growing Agchem market.
Published by DalalStreet Business @ 12:45 PM
UTV Software - Disney Hikes Stake - Analysis
Monday, February 18, 2008The Walt Disney Company Limited (Disney) has increased its stake in UTV to 32.1% through a preferential share allotment of shares (9.4m) for US$203m at Rs860.8/share. UTV promoters will be issued 4.5m warrants at Rs860.8/share. Disney and UTV will be equal partners, each with a 32.1% stake with Ronnie Screwvala retaining management control.
Induction of a technically and financially strong partner like Disney is likely to bring significant synergies and value to UTV's existing businesses. The deal dampener, however, is the pricing, which is significantly below the market expectation. We are also surprised by the extent of funds raised, which is considerably above past requirements stated by management.
Synergies with Disney will definitely flow through, although the extent and timing remains uncertain at this point in time.
Published by DalalStreet Business @ 10:21 AM
Reliance Power Bonus Issue on Feb-24
Sunday, February 17, 2008
In an effort to live up to the expectations of small investors, Anil Ambani along with his core team in Reliance Power Ltd met just a while ago and have decided to convene a board meeting to issue Bonus shares to IPO investors excluding the promoter group.Our analysts are quick to point out that the Bonus shares may get locked-in or may come with some clause to make the investor hold the shares for long-term. Lets not take the route American economy has taken for FREE and EASY Lunch. Let Anil Ambani strive, build and make Rel Power operational in record time to win the hearts of our rigid analysts.
Consider this as Tina Ambani's gift for Reliance Power shareholders and also to save the ADAG group brand name which took a severe beating ahead of Reliance Infratel IPO.
Published by DalalStreet Business @ 4:28 PM
HCL in Britain's Top Employers List
Saturday, February 16, 2008
HCL Technologies has informed us that it has been named by CRF UK, the independent business research organization, as one of Britain's top employers, 2008.Selected for excellence in HR management, the 100 chosen companies will be publishing in a title by guardian books and in the newspapers online version finalists will be formally announced at an awards dinner on March 20th, where the book will be launched. The book will contain company profiles of those selected, which will cover the company's performance in relation to the assessment criteria and will offer commentary from the panel of advisors.
Congratulations to Shiv Nadar and HCL.
Published by DalalStreet Business @ 11:50 AM
Punj Lloyd bags $300 mn order
Thursday, February 14, 2008Punj Lloyd has bagged $300 mn order. The project, which starts this month and is slated for completion in April 2009, comprises the resort's casino, theatres and retail arcade.
In December 2007, Punj Lloyd had secured a contract for building delayed coker unit & coker LPG Merox Block for the residue upgradation project of Indian Oil Corporation at its Vadodara, Gujarat refinery.
The company's order book now stands enhanced at Rs 18,000 crore [$4.5 bn]
Published by DalalStreet Business @ 11:14 AM
JP Associates Laundering 45% of Jaypee Infra ?
Wednesday, February 13, 2008After JP Associates conference call, we were trying to figure out who is walking away with the remaining 45% of the newly formed entity JP Infra. Management has responded in e-mail but is still shady about the 45% which may goto management-politicians backing the deal. Welcome to Business India, Land of Shady deals :-)
Here is the e-mail from the management.
In the past few hours we have received numerous enquiries from analysts and the investment community regarding JAL' s shareholding in its SPV for the Taj Expressway project namely Jaypee Infratech Ltd.(JIL)It is the same case like Anil Dhirubhai Ambani's allotment to AAA ventures in Reliance Power IPO scam.
JIL was and remains to be a 100% subsidiary of the group. The authorised share capital of JIL was increased from Rs 200 crores to Rs1000 crores to meet its capital requirements, JAL subscribed to an additional 35 crore shares at Rs 10 each which represented 55% of the new authorised capital.
Published by DalalStreet Business @ 2:08 PM
Jain Irrigation + Isreaeli Mekorot sign MOU
Jain Irrigation Systems (JISL) has informed us that the company and Mekorot, the National water company of Israel have signed an MOU for cooperating and working together in India in projects related to water infrastructure in the country. Initially the two companies will establish a framework for joint cooperation and collaboration to explore potential projects in the field of desalination plants, water resource management, water supply systems, municipal water management / wastewater treatment and reclamation projects in India.
The two companies intend to execute the water projects by using their core competencies and expertise in the water sector. Mekorot will contribute and provide design capabilities and technologies along with resources for implementation, management, operation and maintenance of such projects. The company will contribute and provide the customer relationships, business development, management resources, procurement of equipment and execution of facility / plant.
Published by DalalStreet Business @ 1:15 PM
VSNl Changes Name to Tata Communications
Tata's managed VSNL has changed its name to Tata Communications. The company also launched Tata Global Network (TGN) and unique experience of operating in emerging markets in Asia and Africa to deliver a new world of globally managed communications solutions.
Earlier in Dec07, Tata Communications launched WiMax broadband services in Bangalore. Tata Communications' Wimax network roll-out in India will provide customers with high-speed and reliable connectivity to over 100 cities and towns. Customers of Tata Wimax broadband have given a thumbs down to the service due to extremely poor customer service.
Published by DalalStreet Business @ 11:20 AM
McNally Bharat Engg bags order from SAIL
Tuesday, February 12, 2008McNally Bharat Engineering Company has announced that the company has received an order from Steel Authority of India for expansion of IISCO steel plant - raw material handling system ore handling plant valued at Rs 621.88 crore inclusive of all taxes and duties.
Further, the company has informed that Steel Authority of India, Bokaro Steel Plant have awarded an order for Bokaro Steel Plant 7.0 MT expansion - coupled pickling line tandem cold mill for CRM-III (package no. 026) for an amount of Rs 70.58 crore.
Published by DalalStreet Business @ 11:44 AM
Consolidated Construction gets 242 crore Order
Monday, February 11, 2008Consolidated Construction Consortium has received orders for Airport Terminal Building at Dehradun valued Rs 34.64 crore, Paediatric Hospital building at Bangalore valued Rs 16.00 crore, Auto components plant at Singur, WB valued Rs 6.27 crore, Five Star Hotel building at Chennai valued Rs 38.60 crore, Housing Project at Chennai valued Rs 100.00 crore, Factory building at Nalgonda, AP valued Rs 17.00 crore and Others valued Rs 29.51 crore during the month of January 2008.
Published by DalalStreet Business @ 10:39 AM
Moser Baer plans 600 MW thin film PV capacity
Moser Baer India has informed us that its wholly owned subsidiary, PV Technologies India, has signed a memorandum of understanding (MoU) with a leading global equipment supplier to secure supply of critical equipment for a 565 MW phased expansion of its thin film photo voltaic modules manufacturing capacity, which together with the current project capacity of 40 MW will take the total manufacturing capacity to over 600 MW by 2010.
Thin film solar modules are ideal for energy farms, rural applications and building integrated photo voltaic markets. Photovoltaic modules based on large area thin film technology provide a path to cost parity between solar grid power. According to market estimates, the thin film based solar modules will see large emerging applications and a robust demand that, according to industry estimates is expected to grow ten fold; from 250 MW currently to 2GW with a market size of $5 billion by 2010.
Published by DalalStreet Business @ 9:37 AM
Simplex Castings receives Railways Order
Thursday, February 07, 2008Simplex Castings has bagged an order worth one hundred and forty million rupee from Ministry of railway, Governemnt of India for supply of coco bogies (chasis for electrical locomotive, WDG-4). Also orders worth more than one thousand two hundred million rupees are in hand which includes export orders worth three hundred million rupees from the company's valued clients like Indu steel - France, Arcellor - Spain, Ingersoll Rand - Italy, Sandwik Asia - Pune, Al - Nasar Company for coke & chemicals - Egypt, Hyundai Corporation - Korea. The company is in a position to meet the rising demand of its customers who are fully satisfied with its quality.
Due to growing demand & consumption of the company's products, there are lots of growing prospect for the company and in current year the company expects better result in comparision to the last year.
Published by DalalStreet Business @ 12:26 PM
Indian Overseas Bank Results Review
Wednesday, February 06, 2008Indian Overseas Bank reported net interest income of 8% growth to Rs 656 crore was slightly below expectations. Advances grew by a healthy 24% to Rs 54,621 crore and deposits registered a higher 33% growth to Rs 78,791 crore. A dip in NIM to 3.3% from 3.9% was on account of higher cost of funds as a result of falling CASA to 31% from highs of 36% a year ago. This led to low NII growth. However, surprise came from other income which grew 63% y-o-y to Rs.219.5 crore. Fee income grew 29% and trading gains were up 39%. Expect net interest income and non-interest income to grow at 18% and 19% respectively over FY07-09E.
PAT grew a healthy 24.5% to Rs 308.1 crore from Rs 246.8 crore in the corresponding quarter the previous year on account of a reversal in investment depreciation (change in method of amortization) resulting in overall provision coming down by 40% y-o-y for the quarter.
Published by DalalStreet Business @ 12:13 PM
Indiabulls Financial Services to raise $1 Billion
The board of Indiabulls Financial Services has decided to raise fund upto Rs 4,000 crore by issue of shares by international offerings through an issue of convertible securities / ADRs / GDRs and FCCBs convertible into equity shares of the company.
The board has decided to issue equity shares / fully convertible debentures / partly convertible debentures or any other securities other than warrants.
The board has decided to issue equity shares / fully convertible debentures / partly convertible debentures / optionally convertible debentures / debentures with right to subscribe to equity shares / convertible / non convertible preference shares / bonds / non convertible debentures with detachable warrants / any other financial instruments convertible or otherwise of the company.
Further, the board has decided to increase the existing authorized share capital of the company of Rs 1243,47,50,000 divided into 50,00,00,000 equity shares of Rs 2 each, 2,50,00,000 preference shares of Rs 300 each and 2,50,00,000 preference shares of Rs 157.39 each to Rs 1543,47,50,000 divided into 200,00,00,000 equity shares of Rs 2 each, 2,50,00,000 preference shares of Rs 300 each and 2,50,00,000 preference shares of Rs 157.39 each.
Published by DalalStreet Business @ 12:10 PM
Phoenix Mills alliance with Entertainment World Developers
Phoenix Mills will be entering into a strategic alliance with Entertainment World Developers (EWDPL) by acquiring over 42% stake in the company. Phoenix itself, is currently building retail led mixed use development centers in tier I cities under the brand name of Phoenix market city and through partnerships with regional players in the tier II cities.The 42% stake will be acquired by Phoenix through a combination of fresh cash infusion to acquire equity in EWDPL, and through the merger of certain entities that currently own equity in EWDPL. As a result of the transaction, EWDPL's post money equity is being valued at Rs 1,250 crore.
EWDPL is a tier II city centric retail mall, mixed use developer, currently engaged in the construction and operation of mixed-use retail centers and townships. Its past projects include Indore's first and largest retail mall: Treasure Island Indore - a 650,000 sq foot mall cum hotel which was voted the best designed mall in India for the last year. Treasure Island Indore offers five levels shopping, entertainment (a PVR multiplex), hospitality, dining and hosts over 100 retail outlets.
Published by DalalStreet Business @ 11:23 AM
GMR Infra embraces SAP
Tuesday, February 05, 2008GMR Infrastructure has informed us that the GMR Group has successfully implemented SAP across all its businesses and locations, with the last of its three SAP instances going live on 04 February 2008 at its Head Quarters, Bangalore. Earlier, GMR's airport projects at Delhi and Hyderabad had successfully implemented SAP. SAP will enhance productivity, scale up the operations and businesses seamlessly, provide reinforcement to its operations through best practices and robust security structures and fostering cohesive unity in expanding diversity. GMR implemented all the modules of SAP, relevant to its businesses.
SAP India is the implementation partner for the SAP instance implemented in Bangalore, covering all its businesses, except airports vertical. The hardware for the project has been sourced from IBM. While KPMG are project management consultants, TCS will provide post go live support. GMR has commissioned and implemented all the three SAP instances during the last one year with an investment of about Rs 60 crore.
Published by DalalStreet Business @ 11:54 PM
Prakash Industries steel plant in State of Chhattisgarh
Prakash Industries has established an integrated steel plant in the State of Chhattisgarh at Champa, District Janjgir. The company has entered into a MOU with the Government of Chhattisgarh on 01 February 2008 to establish and operate a 600 MW thermal power station in the State of Chhattisgarh with an investment of approximately Rs 2400 crore.
The project may be implemented in the company or in a SPV formed for this purpose. The company would be entitled to wheel the power through Power Grid Corporation of India / other grid lines or its own dedicated lines for its own use or for its customers. The project would be operational within a period of 3 to 4 years and would be financed through a mix of equity and debt.
Published by DalalStreet Business @ 11:56 AM
Reliance Infratel files for DRHP
Monday, February 04, 2008
Reliance Communications has announced that Reliance Infratel, subsidiary of the company proposes an initial public offering - IPO of 8,91,64,100 equity shares of Rs 5 each for cash at a premium to be decided through the 100% book building process. The issue will constitute 10.05% of the post-issue paid-up equity capital of the company.The company has filed its draft red herring prospectus with the Securities and Exchange Board of India (SEBI), on 04 February 2008.
The company is part of the Reliance Anil Dhirubhai Ambani group and its business is to build, own and operate telecommunication towers and related assets at designated sites and to provide these passive telecommunication infrastructure assets on a shared basis to wireless service providers and other communications service providers under long-term contracts. These customers use the space on the company's telecommunication towers to install their active communication-related equipment to operate their wireless communications networks.
goBroadband reports that the company is on a aggressive expansion mode for FY2009 as it extends its GSM footprint on PAN-India basis.
Published by DalalStreet Business @ 2:41 PM
Hotel Leela + Puravankara Projects Result Overview
Sunday, February 03, 2008
Hotel Leela reported 3QFY08 revenues of Rs1,430m and net profit of Rs550m. Results are not comparable on a YoY basis because of merger of Kovalam Hotels, a subsidiary, during the quarter. Net profit for the quarter was augmented by high other income which includes gains of Rs69m on forex debt.The company recorded a healthy EBITDA margin of 51.7% for the quarter on the back of 8% YoY ARR growth, led by 27% growth in Mumbai ARR while Bangalore ARR declined 12%, and high occupancy of 76% which was boosted by higher business and tourist traffic.
Properties on the anvil include hotels at Gurgaon (management contract), Udaipur, Chennai, Delhi, Hyderabad and Pune to be operational over next 2-3 years.
Puravankara Projects:Revenues grew 78% yoy to Rs1,505m while net profit increased 122% yoy to Rs631m on account of a sharp increase in EBITDA margin by 830bps YoY to 39.4% and net interest income of Rs62m in 3Q FY08,
compared to interest expense of Rs3m in 3Q FY07.
~72.8 acres of land added – 30 acres in Hyderabad near Hitech City and 42.8 acres in Sriperumbudur near Chennai. These are still to be included in our NAV estimate. 2) Area under construction has increased to 18.8m sq ft with the launch of two large residential projects in Chennai and Kolkata (JV with Keppel Land) with a total area of ~6m sq ft.
Puravankara's large exposure to Bangalore and Chennai is an advantage over North India-based developers, since we believe South India appears to have lower supply risks.
Published by DalalStreet Business @ 10:58 PM
Indraprastha Gas + GAIL Analysis of Results
Saturday, February 02, 2008Indraprastha Gas: The company reported a strong set of 3QFY08 numbers, with net income growing 27% yoy to Rs450m, in line with our
estimate, driven by sustained volume growth in both CNG and PNG. This was in line with the run rate over the last few Qs. Underlying business remained strong with increasing
PNG penetration (volumes up 18% yoy) and robust growth in CNG sales.
Noida operations will provide a fillip to volume growth from FY09E, with c.5 stations likely to be operational by Mar-08. Though 3 years marketing exclusivity (from Oct-07) for incumbents is lower than expected, first-mover advantage and rapid network
expansion create sufficient entry barriers for potential new entrants.
GAIL:GAIL's 3Q reported net income of Rs6.2bn was down 7% yoy and below our estimates. Core operating profits of Rs8.7bn were also significantly below estimates, driven primarily by lower than expected LPG and petrochemical production.
LPG production of 307KT during 3Q was significantly lower than recent trends (average 350KT for the last four quarters), impacted primarily by the 15-day annual shutdown at Gandhar and Vijaipur. Another 15-day shutdown at the Pata petrochem plant impacted petrochem sales, down 16% qoq and 14% yoy. The lower resulting petrochem and LPG EBITDAs drove the poor operating performance for the quarter, significantly below our estimates, despite stable transmission EBITDA.
Published by DalalStreet Business @ 8:04 PM
Jubilant Organosys + Sun Pharma Q3FY08 Result Analysis
Jubilant Organosys: Jubilant's 3QFY08 results were in-line with expectations, with a robust trend in revenues as well as profitability. The high margin PLSPS business (especially CRAMS) was the key growth driver and now contributes c62% of revenues.Sales growth of 37% yoy (19% organic) & 540 bps expansion in EBIDTA margins led to an 81% increase in recurring PAT. Reported PAT was buoyed by forex translation gains (Rs133m). CRAMS was the key growth driver, up 98% yoy (53% organic), while the legacy industrial & performance products business benefited from lower molasses prices (down 20% YoY).
Research services business to gain traction in coming quarters; ii) Capacity expansion at Hollister-Stier to 120m vials/annum to come through in 1QFY09; iii) Total capex of Rs3bn in FY08 plus Rs2bn in subsidiaries including hospitals and SEZs
Sun Pharmaceuticals: Sun's strong 3Q (sales up 47%; PAT up 60%) was primarily due to exclusivity sales of oxcarba in the US, reflected in the step jump QoQ in Caraco's distributed sales. Sun launched generic Protonix as talks between Teva & Wyeth failed. We believe Sun may enjoy extended co-exclusivity (with Teva), as the only other P-IV filer (Kudco) will get approval only after its 30- month stay expires (Dec'08)
Sun indicated that it has an option to buy out the current promoter holding, which would take its stake in Taro to 40%. Sun has a "not to sue" covenant from Wyeth & could get approval in June'08E, albeit as a non AB rated product. Sun could generate sales of cUS$315m during exclusivity; however, we await approval & more clarity on distribution strategy.
Published by DalalStreet Business @ 11:04 AM
Unitech + Omaxe - Q3FY08 Realty Slowdown Ahead ?
Unitech:3QFY08 revenues increased 19% yoy to Rs11,421m. EBITDA margin at 64.3% was flat yoy, but a lower tax rate helped net profit grow 39% yoy to Rs5,258m. EBITDA margin increased to 64% in 3Q from 50% in the previous quarter because of higher proportion of commercial/retail asset sales.Unitech has received LOI (Letter of Intent) for licenses in 22 circles and has paid ~Rs16.5bn as license fee - we await more details on spectrum allocation. UCP, the AIM fund, has widened its scope of investment to include retail/hotels assets - this could provide potential for Unitech to inject more assets into UCP.
Plans to transfer 40% stake in 3 IT Park/SEZ assets, which are partly owned by UCP, to a business trust to be listed in Singapore. UOT is expected to have an initial portfolio of ~10m sq ft.
Omaxe:3QFY08 revenues increased 18% YoY to Rs6,682m while net profit increased 50% YoY to Rs1,542 on the back of higher other income and 500bps YoY improvement in EBITDA margins to 31.2%.
The company has formed a consortium with GVK and Nagarjuna Construction to bid for infrastructure projects such as airports, roads, bridges, etc. The consortium has currently bid for redevelopment of Udaipur and Amritsar airports and development of Badarpur Highway.
Omaxe is planning to build hotels in Faridabad, Amritsar, Greater Noida and Patiala and is currently in talks with large hospitality chains to form a strategic alliance.
Published by DalalStreet Business @ 10:58 AM
Punj Lloyd + Nagarjuna Constructions Q3FY08 Results
Punj Lloyd: After 1HFY08 PAT growth of 138% YoY, Punj Lloyd’s 3QFY08 Recurring PAT at Rs613mn up 27% YoY was substantially lower than CIR estimates of Rs1.0bn on the back of losses on legacy projects in Semb E&C to the tune of Rs680mn. Reported PAT was higher at Rs917mn on the back of sale of investments of Rs371mn.
In 3QFY08 Semb E&C substantially completed certain low-margin legacy orders in which there were cost overruns due to delays and design changes, which led to a booking of losses of Rs680mn. The Punj + Semb combine ended 3QFY08 with an order backlog of Rs160bn up a tepid 12% YoY. Though the Semb backlog at Rs62bn is up 35% YoY, Punj backlog at Rs98bn, down 13% YoY, is a concern given that the margins are higher on the Punj orders than on the Semb orders.
Nagarjuna Constructions: Nagarjuna posted recurring PAT of Rs396mn, up 5% YoY, and largely in-line with our expectations of Rs389mn for Q308. While margins were in-line with estimates, revenue growth of 11% YoY was well below our estimate of 21% growth. PAT was boosted by lower-than-expected interest costs and taxes and higher than expected other income.
The company mentioned that the land delays were resolved and the projects were back on track, but revised down its revenue guidance by 8% from Rs37.5bn to Rs34.5bn. Management maintained that it will clock top-line growth of at least 30%-35% CAGR for the next 2 years.
Order booking has continued at a steady pace - Nagarjuna has won Rs15bn worth of orders in Q308 and has guided for an order backlog of Rs100bn for FY08E.
Published by DalalStreet Business @ 10:53 AM
Future Capital Holdings Lists with Disappointment
Friday, February 01, 2008Kishore Biyani's Future Capital Holdings saw a modest gain of 12% on listing. The current price of Rs 866 discounts its year ended March 2007 EPS of Rs 0.60, by a PE multiple of 1443.
Future Capital Holdings (FCH) had priced its IPO at Rs 765, at the top end of the Rs 700 to Rs 765 price band. At the IPO price of Rs 765, the issue was priced 1275 times its year ended March 2007 EPS of Rs 0.60 (based on consolidated financial performance).
The company's IPO was subscribed a huge 133.44 times. The qualified institutional buyers (QIBs) portion was subscribed 180.72 times, the non-institutional investors portion 84.38 times and the retail investors portion 55.21 times.
Published by DalalStreet Business @ 10:33 AM
