Wind Market Open for Clean Energy
Monday, June 30, 2008
India has introduced a plan to encourage investments in Wind power clean energy by giving generation-linked incentives of 50paise/kWh, in case investors can't claim accelerated depreciation incentive. This scheme, is likely encourage those Independent Power Producers (IPPs) / foreign financial investors who have been either limited or absent from the market due to tax anomalies. This plan improves IPP project IRRs by 175-210bps. If successful, it could rejuvenate growth in the world's 5th largest market with less than 20% potential tapped of the 45GW.You should note that India has been an early adopter of renewable energy, with wind accounting for ~6% of installed capacity. More importantly, in 2007, 16% of new generation capacity add
was through wind turbines.
Published by Webmaster @ 11:08 AM IST.
Panacea Biotec - Weak Q4
Sunday, June 29, 2008
Panacea Biotec's Q4 PAT (Rs249mn) was 3% lower than estimates. Revenues were 26% lower than estimates. While gross margin improved significantly by 450bps which reflects the price increase in polio vaccines, EBITDA margin (16.8% vs 18.7% last year) was lower on account of forex loss, and higher than expected personnel and R&D costs. Q4 PAT was saved largely by other income due to reversal of sales tax liability.Expect Panacea to drive growth in FY09 through pentavalent combination and other vaccines launches. Likely progress on Anthrax vaccine tender award Dec'09, potential M&A activity, launches of IPV vaccine, Pharma NDDS dossier filings.
Published by Komal M @ 8:49 AM IST.
Analysis of Idea - Spice - Telekom Malaysia Mobile Deal
Saturday, June 28, 2008
Laid back Modis who failed to turn around a company in 10 years have finally sold out of Spice Communications [Holds license in Karnataka and Punjab with Spectrum in 900MHz band] to Idea Cellular in a share swap ratio of 100:49. [49 Idea Shares for every 100 Spice]. Going forward what does the future look like for Idea Cellular ?From the structure of Idea's deal it appears that TMI [Telekom Malaysia] is keen to partner a larger player in the Indian Mobile growth story. TMI will acquire 14.99% equity (pre-Spice merger) in Idea at ~Rs157/share as a cash infusion implying post-merger valuation of Idea at ~13x FY10E-EV/EBITDA.
Additionally, TMI holds ~39.2% stake in Spice that will be swapped for a 4% stake in Idea post-merger. Eventually, TMI will hold one board seat in Idea & own between 18.5-20% stake in Idea depending on its participation in the open offer for Spice. The AV Birla group will hold ~46% stake post deal vs ~58% currently.
Published by Sunil K @ 7:49 PM IST.
Inflation hits another High
Friday, June 27, 2008
If P. Chidambaram stakes claim for India's growth story and record tax collection, he should not hesitate to paint himself in black for the co-lateral damage he has caused to 80%+ of India's population by doubling the Inflation during his tenure and making it reach a new 13 year high of 11.42% [Higher than the highest rate of Interest offered by Bank's Certificate / Fixed Deposits]Rising global oil prices with record Inflation has put the Indian markets into PANIC selling mode by Institutional Investors. Until yesterday, Net FIIs selling in the Indian market for the month of June is Rs 9,500 crore [$2 bn].
Update:
Looking at the components, primary articles were up 10.96%; manufactured products were up 9.74% while the fuel price index was up 16.37%. Similar to trends seen since March this year, the uptrend is due to edible oils classified under non-food articles, fuel (with market determined fuels up 30%-50%), basic metals up 21.3% and iron-ore up 42.6%.
Upward revisions to the index continue with the April 19 data being revised up from 7.57% to 8.23%. Of the headline 11.42% WPI number, 2.49% is attributed to primary articles, 5.42% to manufacturing and 3.54% to the fuel index.
Published by Webmaster @ 12:28 PM IST.
JK Paper - Performance Sliding
JK Paper reported Q3FY08 results. Net revenues increased by 17.8% YoY / 7.1% QoQ to Rs 2.2 bn. EBITDA margins declined sharply by 530 bps YoY / 240 bps to 15.2%, as against consensus expectations of 18%.
Increase in raw material by 54.9% YoY and 60.2%YoY increase in power and fuel cost put pressure on margins. Raw material as percentage of sales for the quarter was 27.1% (20.6% previous year) and power and fuel was 10.7% (7.9% previous year). As a result, EBITDA was down by 12.4%YoY / -7.6% QoQ to Rs 336 mn (we expected Rs 383 mn). Higher other income of Rs 52 mn as against mere Rs 2 mn previous year supported financials. Commissioning of new packaging plant led to increase in depreciation and interest charge. Depreciation increased by 35.7% YoY to Rs 170 mn while interest increased by 83.8% to Rs 143 mn. As a result PBT declined by 58.3% to Rs 76 mn.
Company on fully diluted basis reported EPS of Rs 2.0 as against Rs 1.5 previous year.
Published by Webmaster @ 12:09 PM IST.
GMR's Acquisition in Intergen
Thursday, June 26, 2008
GMR Infrastructure has acquired 50% stake in Intergen, a power utility with assets in UK, Mexico, Netherlands, Australia and Phillipines, for US$1.1 B. Intergen has an operating capacity of 7,658MW, while its attributable capacity is 6200MW. 85% of Intergen's capacity is natural gas based, while the rest is coal-based. GMRI has purchased the stake from AIG, while Ontario Teachers' Fund holds the balance 50%.Intergen clocked revenue of US$1.6B, EBITDA of US$613M, PAT of US$105M, FCF of US$330M and distributed US$140M dividend in 2007. It appears highly leveraged with gross debt of US$4.3B as against equity of US$600M, but we believe this is not unusual amongst utilities, as it is within the prescribed DSCR of 1.4.
GMR's Modus Operandi behind Intergen Investment:
GMR has funded its US$1.1B investment via domestic bridge loans at 10.5%. Interest payment should negate US$50 mn of GMR's estimated share of Intergen's profits (based on 2007 data). Intergen's generous dividend payout will go towards debt servicing at least through 2010, in our estimate. Refinancing the loan via forex loans and equity injection would enhance contribution at the net level.
Published by Webmaster @ 12:16 PM IST.
Parsvnath Developers - Modest Quarter. Slowdown Ahead
Monday, June 23, 2008
Parsvnath Developers Ltd - PDL reported F4Q08 consol results - sales up 25.5% to Rs5 bn, OPM compressed by 190 bps to 32.8%, which together resulted in 19% fall in net profits to Rs1.07 bn. Full year profits for F08 were Rs4.2 bn (up 45%), versus our estimate of Rs4.4 bn, 5% below consensus estimates.PDL's net debt has risen to Rs14 bn (74% net gearing) versus Rs12.8 bn (71%) in F3Q08. Receivables continue to rise - Rs12.8 bn (Rs10.8 bn in F3Q08) - implying incrementally 37% of sales (43% previous qtr).
Land bank is 211 msf (210 msf in F3Q08), area under construction moves up to 77 msf (75.8 msf in F3Q08) and pre-sales moves up to 40 msf (32.8 msf earlier). Ongoing projects include 24 msf of plotted development. The company grossed Rs50 mn in rental income in F08, which it expects to rise to Rs250-300 mn in F09.
Published by Webmaster @ 5:42 PM IST.
Hindalco Industries 1:3 Rights Issue
Friday, June 20, 2008Hindalco Industries Ltd has informed us that the Company at its meeting held on June 20, 2008, has approved the issue of Equity Shares for an amount not exceeding Rs 5000 Crores to the existing Shareholders on rights basis ("Rights Issue") to part finance the acquisition of Novelis Inc. The Share Ratio for the Rights issue will be 1:3, i.e. one right of Re 1 each for every three equity shares of Re 1 each held by the shareholder as on the Record Date to be announced later. The price per share for the Rights Issue would be decided by the Board and announced at a later date.
Published by Webmaster @ 1:07 PM IST.
Chidambaram's Inflation beat Analyst Expectations
Indian Inflation soared to a NEW HIGH for the week ended June-7th to 11.05% Vs 8.75%. More Details will be updated soon.Update @ 16:00 IST:
While this week's data incorporates the effect of the fuel price hike (auto-fuels by 10%-15% and cooking fuels by 17%), the headline was expected to be close to ~10% levels. Besides the fuel price increase, the uptrend seen in basic metals and iron-ore since the last two months continues up 20.7% and 41.6% respectively.
Primary articles were up 10.8%; manufactured products were up 9.1% while the fuel price index was up 16.25%. Of the headline 11.05% WPI number, 2.5% is attributed to primary articles, 5.1% to manufacturing and 3.5% to the fuel index.
Most Analysts are of the view that RBI will hike the repo rate ahead of July policy meeting.
Published by Webmaster @ 12:01 PM IST.
Inflation number expectations - Various Research Houses
Thursday, June 19, 2008
The Government of India has clearly failed to control Inflation which is expected to touch double digit leaving the conservative investors [Fixed Interest Instruments] in deep pain. Here is how various brokerage houses are expecting the Indian Inflation numbers to be announced tomorrow.ABN Amro Bank 10.5%
CARE Ratings 9.23%
CRISIL Ltd. 9.82%
Dun & Bradstreet Info. 9.10%
ICICI Bank 10.10%
IDBI Gilts Ltd. 9.68%
JPMorgan Chase Bank 9.77%
Kotak Mahindra Bank 9.77%
Along with global weakness, the above numbers shocked Traders which led to some unwinding today.
Published by Sunil K @ 7:05 PM IST.
Power Grid Corporation - Results Electrified
Power Grid Corporation's revenue for the year was up 23.9% to INR 46,148 mn over FY07. While revenue from Transmission grew by 29% to 41,885 mn, Telecom revenue was up 60% to INR 1,235 mn. The company saw a steady increase of 10% in its Consultancy segment.
Net profit for the year was up 50% to INR 16,528 from INR 10,975 mn last year. In the current year, the company has commissioned projects worth INR 60,185 mn in the transmission space on which it has started to receive returns. Other income for the year was up 30% at INR 4,667 mn.
The company had its IPO in FY08 and has ~INR 8,800 mn of cash left from the issue. The company also saw increase in Open access charges by 36% to INR 527 mn. Also in FY08, the Telecom segment of the company has become PBIT positive. The company plans to invest close to INR 85,000 mn in FY09 for various transmission projects. On the Telecom front, the company intends to increase its revenues to ~50,00 mn by FY10
Published by Sunil K @ 1:51 PM IST.
IRB Infrastructure Developers - Results Review
IRB Infrastructure's topline for FY2008 increased by 40% yoy to Rs7.3 bn driven by 28% growth in toll collection segment (Rs3.7 bn) and 46% growth in E&C segment (Rs3.6 bn). Operating profit for the year stood at Rs4.1 bn, a yoy improvement of 47% and accordingly the operating profit margin for the year improved by a healthy 300 bps to 56%. PAT after minority interest witnessed a strong growth of 86% yoy to Rs1.1 bn against expectations of Rs996 mn.
The order book of the E&C division stood at Rs65 bn. Out of this, pure E&C order backlog is at Rs38 bn (Rs34 bn captive E&C) which is expected to be completed in next 30 months. The balance is operations & maintenance order book of Rs27 bn, which is to be executed over next 10 years.
Published by Webmaster @ 12:50 PM IST.
JPT Securities - What's Cooking ?
A BUY was first recommended on JPT Securities on the 26th of May. Since then the stock has tripled and still locked in upper circuit today at Rs 124.Lets closely look at what has happened in JPT Securities. JPT Securities suddenly came into the spotlight, striking an all-time high of Rs 124. They have appreciated 302.76% in the past quarter. The one-year period return was a massive 985.81%.
The rally materiliased after the promoters, headed by Managing Director J P Totla, sold their entire stake of 18.05 lakh shares, or 60.06%, at Rs 32.10 per share to Awaita Properties, Mumbai [Promoted by Nikhil Gandhi and Bhavesh Gandhi]. The shares were sold through a block deal on the BSE on 24 April 2008. Consequently, the promoters also agreed to transfer the management control to the acquirer.
On 30 April 2008, Awaita Properties launched an open offer to the public shareholders for acquiring an additional 20% stake in JPT Securities, at Rs 32.5 per share, as per the Sebi guidelines. The company's equity share capital is Rs 3.01 crore, with face value of Rs 10 per share.
Nikhil Gandhi is said to be the right hand of Reliance Industries' CMD,Mukesh Ambani. Speculation is rife in the market that Nikhil Gandhi will opt for a backdoor listing of his Mumbai-based SKIL Infrastructure.
What is the Modus Operandi employed by Gandhi and Mukesh Ambani ?
Ambani's no doubt create wealth for shareholders, but in turn they create more wealth for themselves. Infrastructure is currently a Big Game. They want to unlock the value on this theme of their privately held companies and projects. If you look at what has happened to Horizon Infrastructure [PDF]- They buy a company which is listed in BSE completely, go for an open offer mop up as much more shares as possible. Now Change the name of the company and Transfer Big Infrastructure projects to this company thus giving it a way of backdoor listing.
If you have thoughts to share, you may write to feedback @ dalalstreet dot biz.
Labels: JPT-Securities-Insider
Published by Sunil K @ 11:23 AM IST.
Consumer Brand Launches - Emami + Nestle
Wednesday, June 18, 2008
Emami has launched Emami Fair And Handsome - a fairness cream for men in a new sachet format for Rs5. Fair And Handsome is a market leader in the men's fairness cream market.Nestle India has launched Polo Xtra Strong, an innovation on its existing brand, Polo, with added menthol crystals. This is available in singles format priced at 50 paise.
Avesta Good Earth Foods, a subsidiary of Avesthagen, launched Good Earth Whole Wheat Crackers, enriched with Teestar, a proprietary ingredient that reduces blood glucose levels. Priced at Rs32 for a 100g pack.
Published by Komal M @ 2:06 PM IST.
Punjab National Bank - Falling treasury income + interest margin
Punjab National Bank's total business grew by 21% to Rs2860 bn on the back of 19% growth in deposits and 24% growth in advances, sequentially deposits grew by 9.1% and advances grew by 18%.PNB's reported NIM reduced by 41 basis points to 3.66% from 4.07% in 4QFY07 mainly due to deposits cost pressure, though the bank managed to hold the reduction in NIM by increasing credit-deposit ratio by 272 bps and increasing exposure to SME and retail sectors. Core operating performance was much better with other income and reduced operating expenses [33% (Y-o-Y) drop in employees' expenses] led to 2.3 times jump in bottomline.
In percentage terms, GNPA and NNPA decreased to 2.7% and 0.6% from 3.4% and 0.8% respectively. EPS for FY08 was at Rs 65. The bank is expected to take significant hit on bottomline the current year due to NPAs, Agricultural Loans and Inflationary pressure.
Published by Sunil K @ 11:59 AM IST.
Wire & Wireless India - Long way to go
Wire & Wireless India (WWIL) recorded revenues of Rs755 mn during Q4FY08, representing a top line growth of 7.4% QoQ and 13.8% YoY. The growth was primarily led by 30% QoQ increase in carriage revenue from Rs264 mn in Q3FY08 to Rs355 mn in Q4FY08.
Digital subscription revenue also grew significantly by 66.2% QoQ from Rs45 mn to Rs75 mn. Digital revenue growth was attributed to ARPU expansion which grew to Rs95 per month during quarter (~36% YoY growth).
The company's OPM improved by 108 bps during the quarter, led by a sharp 490 bps improvement in cost of goods and services. OPM stood at -3.4% during Q4FY08, compared to -24.9% in Q4FY07. The company reported a net loss of Rs 75.4 crore. We personally think that the management of Wire & Wireless India is extremely weak with constant exodus of folks at the top management.
Published by Sunil K @ 11:52 AM IST.
Index of Industrial Production - MoM Report
Tuesday, June 17, 2008We are presenting the Month Over Month IIP - Index of Industrial Production, the barometer for the health of the Indian economy. The bar chart below shows IIP from May-07 to April-08.
The following graph shows the contribution of each of the sectors to IIP - Manufacturing, Mining and Electricity between May-07 and April-08.
Published by Komal M @ 2:31 PM IST.
McNally Bharat - Result Update
McNally Bharat's 4Q FY08 sales rose 20.3% yoy, to Rs2.06bn, 18.9%. Sales were under pressure due to some execution delays and to the proportionately greater share in the order book of sectors like steel, where the average execution cycle is longer.
The EBITDA was Rs174m, vaulting 221.5% yoy. The EBITDA margin expanded 528bps yoy, to 8.4%, against the expected 365-bp expansion. The margin expansion mainly stemmed from the lower base and the non-materialization of the anticipated (when bidding) cost pressures. The bottom line for the year grew 47.7% yoy, to Rs96m. The higher EBITDA margin and lower interest chiefly led to the robust bottom line even as the top line came under pressure.
The company is expected to post a 22% topline growth over FY 2010.
Published by Sunil K @ 1:58 PM IST.
Godawari Power and Ispat - Results
Godawari Power and Ispat Ltd (GPIL) in Q4 FY08 reported revenue of Rs2.6bn, a growth of 139.0% yoy on account on a rise in production and improved realization. On qoq basis, it registered a 21.1% growth on the back of lower ferro manganese and sponge iron sales. Sponge iron, billets and ferro manganese realizations on qoq basis rose 13.2%, 11.7% and 13.2% respectively.
For the full year, standalone revenue for the company registered a growth of 87.6%yoy to Rs8.3bn. The growth in revenue was account of a rise in production of sponge iron and billets. GPIL increased its sponge iron capacity to 0.5mtpa from 0.2mtpa, billet making to 0.4mtpa from 0.25mtpa and wire rod facility to 120,000tpa from 41,600tpa during the year. The new capacities are expected to show results from FY09.
OPM in Q4 FY08 expanded by 100bps to 18.6% from 17.6% witnessed in the same period last year. The company witnessed a bottomline growth of 139.9% yoy to Rs288.3mn in Q4FY08 from last year's Rs120.2mn. Capacity additions of the sponge iron and billet making capacity has been completely ooperatinla during the quarter and will lead to robust volume growth for the company.
Equity Research has detailed coverage on the Godawari Power and Ispat.
Published by Webmaster @ 11:26 AM IST.
Advance Tax Filings for FY2009
Monday, June 16, 2008
The last date to file first installment of Advanced Tax for FY2009, was June-15th. We have obtained Advance Tax figures for SENSEX heavy weights.- SAIL paid an Advanced Tax of Rs 457 crore against Rs 454 crore year ago
- ICICI Bank has paid Rs 340 crore Vs Rs 250 crore a year ago
- SBI has paid Rs 663 crore Vs Rs 503 crore a year ago
- IDBI Bank has paid mere Rs 10 crore Vs Rs 7 crore a year ago
- Reliance Industries paid Rs 340 cr Vs 295 cr a year ago
- Bajaj Auto paid Rs 50 cr Vs Rs 60 cr a year ago
- HDFC's Advance Tax shot up by 40% to Rs 140 cr Vs Rs 95 cr
- Tata Motors paid Rs 30 cr and Ambuja Cement Rs 100 cr
So far their is no dip showing any signs of potential slowdown. However, what's bothering investors is how will the government tackle likely double digit inflation ?
Published by Webmaster @ 3:13 PM IST.
Iron ore export tax drags down Sesa Goa
The Indian government announced the much anticipated iron ore export tax of 15%, putting an end to a long period of uncertainty on this front. This was due for long time to contain inflation. We continue to hold a constructive view on iron ore sector fundamentals, and would view any weakness in stock price on the back of this news or due to weakness in Chinese iron ore spot prices as a buying opportunity.Sesa Goa was trading down by 2% at Rs 3,660 compared to its cum-bonus high of Rs 4,320 in the first week of May-08.
Published by Webmaster @ 2:35 PM IST.
SBI defers interest rate hike
State Bank of India (SBI) today deferred a decision on raising interest rates and said it will prefer to wait for one to two weeks before taking a call on the issue. SBI Chairman O P Bhatt said in Hyderabad,
We will wait and watch and take a little time. We want to examine whether we can absorb the repo rate hike. I think we can afford to wait for a week or two. We will deliberate, get the data and then we will look at our strategies.However, Private Sector bank, Yes Bank has announced a 0.5% hike in PLR. It has also raised interest rates on Fixed Deposits.
Published by Webmaster @ 2:26 PM IST.
Impact of Duties on Premium Cars and SUVS
In a surprise move, the government imposed additional specific duties of Rs15,000 and Rs20,000 on cars/ UVs with engine displacements between 1500-1999 cc, and over 2000cc, respectively. There doesn't appear to be a significant economic rationale, as the hike will result in additional excise inflows which are 0.5-1% of the overall excise collections.The overall impact on end prices will be ~2-3% for cars and UVs, but, when juxtaposed against high inflation rates, high commodity prices and persistently high finance rates, could result in demand displacements over the short term.
In short term, Mahindra is the most vulnerable to a sales decline (Scorpio / Bolero are ~30-35% of overall revenues), followed by Maruti (SX4 is ~4% of volumes, but around ~6-8% of revenues) and Tata Motors (Sumo/Safari are ~3% of volumes and ~5% of revenues).
Published by Komal M @ 12:02 PM IST.
Gujarat Industries Power Co. Ltd.
Saturday, June 14, 2008For Q4FY2008, Gujarat Industries Power Co. Ltd. (GIPCL) has posted 65.7% growth in net sales to Rs. 2,850.3Mn as compared to Rs. 1,719.9Mn for the quarter ended Mar 31, 2007. Power generation has increased during the quarter by 5%, owing to higher PLF contributed by the Surat lignite power plant and Vadodara station-II. Total Income has increased from Rs. 1,755.2Mn for the quarter ended Mar 31, 2007 to Rs.2,912.8Mn for the quarter ended Mar 31, 2008.
For the full year, it clocked revenues of Rs. 9,355.5Mn from Rs. 7,955.8Mn in FY07 presenting a growth of 17.6%. Fuel Cost for the year has increased by 38.4% to Rs. 6,058.7Mn from Rs. 4,378.2 in FY07. This has been due to increase in gas prices, subsequent rise in tariff's for the gas based plants & excellent operating performance of the power plants.
Published by Sunil K @ 6:11 PM IST.
IndiaBulls REIT listing - Challenging Times for Realtors
Indiabulls Properties Investment Trust (IPIT) listing on the Singapore exchange is a prime example of the worsening situation; despite the relatively small size of the issue (USD220 mn), it was barely subscribed one time, indicating a definite lack of investor interest. The response to the IPIT IPO does not augur well for other proposed listings that are larger in size, such as those of DLF Assets (~USD1.3 bn) or Unitech Office Trust (~USD700 mn).IPIT's listing received a poor response, reflected by valuations as it closed below issue price at 0.9 s$. Private equity now appears to be the only avenue left for Realtors to fund their projects and even this is becoming a challenge, as these investors are now demanding a higher return on their investments than before.
Published by Webmaster @ 3:35 PM IST.
Inflation at 8.75% ex-Oil
Friday, June 13, 2008India's Inflation is said to be rising the same way like SENSEX was a year ago :-) The wholesale price index [WPI] based inflation for the week ended May 31 rose to 8.75 per cent as compared to 8.24 per cent for the previous week. Inflation rate stood at 5.09 per cent for the corresponding week in the previous year.
During the week, in index for the primary articles group rose by 0.9 per cent while the index for manufactured products increased by 0.7 per cent. The index for the fuel group remained unchanged. [So more to come next week, taking into account the rise in fuel & gas prices] Among the food items, prices of egg, condiments and spices, urad, fruit and vegetable, mustard oil have increased.
Government has also revised inflation rate for the week ended April 5 to 7.71 per cent as compared to 7.14 per cent reported earlier. [What the fu*k ? Revision in retrospect ? It can happen only in India ;-) ]
Analysts were of the opinion that Inflation will soon kiss the double-digit mark :-)
Published by Webmaster @ 12:27 PM IST.
Garware Wall Ropes - Weak Fibers
Garware Wall Ropes (GWRL) has reported results for Q4FY08 lower than consensus estimates, owing to sluggish growth in the cordage segment.Net sales increased 19% YoY to Rs 1.2bn, 8% short of estimates as the revenue share of the cordage business declined to 64% against the full-year average of 73%. Export sales have also been comparatively lower, comprising 33.4% of revenue in Q4FY08 as compared to 42% in FY07 and 36% in FY06. The EBITDA margin, at 13.2%, was 100bps lower due to rising crude prices, which led to higher input costs for cordage products.
For the current year, higher execution in the geo-synthetics business is likely to offset the slowdown in weak fibers of cordage.
Published by Komal M @ 11:14 AM IST.
Inox Leisure - Operating Margins Horror Show
Inox Leisure reported a subdued topline growth for 4QFY2008 of 18.4% yoy to Rs39.3cr (Rs33.2cr) as lower Occupancy (4Q is a seasonally weak quarter) led to a muted 13.4% yoy growth in Footfall. The numbers are strictly comparable because of the inclusion of Calcutta Cine Pvt Ltd in this quarter. For FY2008, Inox registered 30.6% yoy growth in Revenues to Rs185cr (Rs141cr) driven by addition of property leading to a 35% jump in footfalls.Operating Margins: Inox delivered a dismal performance for the quarter registering a 790bp decline in Operating Margin to 10% (17.9%) largely owing to a sharp 782bp increase in Other expenditure and 287bp rise in Staff costs owing to a lower revenue base.
At the end of March-08, Inox had 76 screens and 23,199 seats under operation. Inox will add - Faridabad (four screens with 1,108 seats) and Nagpur (four screens with 1,214 seats) taking its total tally to 84 screens.
Compared to Inox, PVR delivered much better results.
Published by Komal M @ 10:19 AM IST.
Top Private Life Insurance Companies in India
Thursday, June 12, 2008Earlier we have presented statistics on the market share of all the Life Insurance companies in India including LIC [Public Sector]. Today lets analyze the difference in market share of Private Sector Life Insurance Companies over a Year's time.
Top 5 Life Insurance Companies in India at the end of April-2008 are:
ICICI Prudential Life - 22.1%
Bajaj Allianz - 13.8%
SBI Life - 9.8%
Reliance Life - 8%
Max New York - 8%
Top 5 Gaines in Life Insurance Business in a Year:
Reliance Life +3.9% gain in total private life insurance market share
Birla Sunlife +3.3% gain in total private life insurance market share
Met Life +2.8% gain in total private life insurance market share
Aviva +2% gain in total private life insurance market share
SBI Life +1.7% gain in total private life insurance market share
Top Losers in Life Insurance Business in a Year:
ICICI Prudential Life - 8.3% loss in total private life insurance market share
Bajaj Allianz - 2.4% loss in total private life insurance market share
HDFC Standard Life - 1.2% loss in total private life insurance market share
From the above data, the reason is now obvious on why K.V.Kamath, wanted to list ICICI Prudential Life as a separate entity on the bourses.
Published by Komal M @ 10:54 AM IST.
RBI steps in to check rising Inflation - Hikes Repo Rate
With the Indian Inflation out of control, India's central bank - RBI stepped in late last evening and hiked the repo rate - the rate at which it lends/injects money by 25bps to 8%. The reverse repo rate - the rate at which RBI absorbs liquidity and the CRR were left unchanged at 6% and 8.25%.Since the uptrend in inflation from 3% levels in Oct 07 to 8%, the RBI has used the CRR as a liquidity absorbtion tool and raised the CRR 75bps in the same period from 7.75% in Sept07 to 8.25% in May08. Despite a deceleration in the macro momentum, in a pre-election year, inflation will continue to get priority over growth.
Home Loan and Auto Loan are likely to see equivalent rise in lending rates [~ 0.25%]
Published by Sunil K @ 10:42 AM IST.
Elecon Engineering Ltd
Elecon Engineering Ltd's [EEL] Q4FY2008 results are below expectations. Revenue below estimates at Rs3.3 bn and 16% yoy growth and net profit below estimates at Rs230 mn and 30% yoy growth.
For FY2008, Elecon Engineering (EEL) reported net profit growth at 26% yoy to Rs672 mn and earnings of Rs7.2/Share, below estimates. Led by slippages in new business, we have revised our revenue estimates by 15.1% (Rs11.5 bn) and 23.2% (Rs14.0 bn) for FY2009E and FY2010E respectively. Consequently, the net profit estimates are revised by 22.1% (Rs840 mn) and 31.6% (Rs992 mn) for FY2009E and FY2010E respectively.
EEL order book at Rs12.9 bn, in line with our expectations. The order book has grown at 55% from Rs8.3 bn to Rs12.9 bn. The current order book indicates robust visibility at 1.6X FY2008 revenues, best in last 5 years.
Published by Webmaster @ 10:31 AM IST.
Ranbaxy: Nephew following Uncle's Footsteps
Wednesday, June 11, 2008
It seems like Malvinder Singh's uncle, Analjit Singh has a deep influence on the former when it runs to corporate and business practices. Ranbaxy, the dream company of late Dr.Parvinder Singh is likely to be sold to Daiichi. Singh family controls 34% stake in Ranbaxy Labs.If you recall, Analjit Singh successfully ventured into Paging business in early 90s and sold it off at the peak to Hutchison by virtue of which he got stake in Hutchison India, later Hutchison Essar. Hutchison sold their stake at peak just last year to Vodafone. Analjit Singh made a killing by patiently holding on to his stake.
It is still not clear how Malvinder will handle group company stakes in Religare and Fortis Hospitals held by Rfanbaxy Labs.
Published by Webmaster @ 9:55 AM IST.
Divis Laboratories Beat Estimates
Tuesday, June 10, 2008
Divis Labs Ltd (DLL) reported revenues of Rs2.8 bn. EBITDA margins at 41% were significantly higher and PAT was Rs 927 mn.CRAMS and generics comprise around 50% of business. There were no one-time large orders registered this quarter. Thus, revenue line is likely to be maintained for the next few quarters.
Divis nutraceuticals plant which was commissioned in June 2008 and FY2009 will see the first year of revenues from this business.Sales is expected to grow by 48% and 40% in FY09 and FY10. Fully diluted EPS could be in the range of Rs 76 to Rs 80 for FY09.
Published by Komal M @ 1:39 PM IST.
Suzlon Energy out of current
The Edison Mission Group has withdrawn orders of 315 MW (second part of a two-phase 630 MW order) given to Suzlon Energy. This order withdrawal by Edison for 315 MW may affect near-term execution; Suzlon may however replace it by other orders in that geography.Edison had the option of not purchasing the second part of the contract and it has exercised that option now. No explicit reasons are available for the exercise of the option by Edison. We believe Edison is a large customer of Suzlon (likely among the top 5 with Suzlon having executed (or executing) about 525 MW for this customer. This is significantly bad news for Suzlon Energy.
Published by Webmaster @ 12:09 PM IST.
Voltamp Transformer - Electrifying Results
Monday, June 09, 2008
Voltamp's net sales increased by 10.4% Y-o-Y to Rs.1351.4 mn in Q4FY08, largely on the back of better price realisations. EBIDTA increased to Rs.334.3 mn in Q4FY08, at 46.1% Y-o-Y growth. EBIDTA margins improved by around 606 bps YoY to 24.7%, mainly due to better price realizations, which led to substantial decrease in raw material cost as a percentage of sales (from 81.3% in Q4FY07 to 75.3% in Q4FY08). Voltamp's PAT during Q4FY08 increased to Rs.216.3 mn in Q4FY08. For the full year FY08, the company showed a growth in net sales of 36.9% to Rs. 5553.5 mn. Its EBITDA increased 92.1% from Rs.613.5 mn to Rs.1178.6 mn while it's adjusted PAT increased from Rs.393.6 mn to Rs.799.0 mn, showing a growth of 103%. The EPS for the full year stood at Rs.79 as against Rs.38.9 last year, registering a growth of around 102.9% Y-o-Y.
Voltamp Transformer's order backlog as of 8th May 2008 stood at around Rs.4485.1 mn
Published by Komal M @ 12:45 PM IST.
Canara Bank - New Businesses for Future Growth
Canara Bank's Interest costs (33% yoy) far exceeded the rise in interest income (18% yoy) and resulted in a 13% fall in the net interest income. Bank is getting rid of low-yield loans,and is expected to lend more aggressively in FY09, thereby earning higher interest and income. Operating expenses increased 10% yoy to Rs. 7 bn. The Bank's employee costs declined by 4%, owing to its virtually stagnant workforce.Non-interest income increased 14% yoy to Rs. 7.1 bn. On yearly basis, the growth was impressive at 53%. As the Bank is venturing into insurance and asset management businesses, the growth in other income is believed to be sustained. Deposits grew by 8% yoy to Rs. 1.5 tn.
Canara Bank reported a Net Profit of Rs 1565 crore for FY08 a growth of 10.1% over previous year. Fully diluted EPS for FY08 is Rs 38.
Published by Webmaster @ 8:48 AM IST.
PVR Cinemas - Super Hit FY 2008
Friday, June 06, 2008
PVR's results is simply a box office hit for the full year FY 2007-08. Sales grew of 49.7% to Rs 265 crore and Net Profit recorded a growth of 112.2% to Rs 21.6 crore resulting in an EPS of Rs 12.7.However, for 4QFY2008, PVR reported a modest Topline growth of 32.9% yoy to Rs54.3cr (Rs40.9cr) on a standalone basis, driven by a 25% increase in Net Ticket revenues, 79% jump in Net Advertisement revenues and 31% higher F&B revenues.
PVR delivered a disappointing performance, registering a 350bp decline in standalone Operating Margins to 13% largely owing to a sharp 556bp increase in Rental costs (on account of service tax levies on lease rentals) and higher overheads to lower revenue base. The company has already made provisions for higher rentals.
PVR Operated 22 properties with 84 screens and 21,853 seats at the end of FY2008.
Published by Sunil K @ 2:16 PM IST.
Emco Ltd - Steady Current
Emco posted a net sales growth of 36% YoY to Rs 3.4bn for Q4FY08 and 44% to Rs 9.4bn for the full fiscal. Project division revenues have picked up pace during H2FY08, contributing 30% of net sales for the fiscal. Management expects an even higher revenue share from this division in FY09, at 45%. EBITDA margins were up by 155bps during Q4FY08 to 14.2% and by 50bps for FY08 to 13.7%. Net profit saw a growth of 98% YoY for the quarter and 59% for the year.
Emco's order book stands at Rs 11bn, which is 1.2x FY08 sales. The healthy order backlog and bright outlook for the project division indicate good revenue flows over the next two years.
Emco is trading at 10x one-year forward P/E, which is a 61% discount to peer company, ABB.
Published by Komal M @ 1:58 PM IST.
Transport Corporation of India
TCI's Net sales rose by 12.7% YoY to Rs3.3bn. However, sales are not comparable YoY due to the hive off of fuel pump stations. Excluding the revenues generated from the fuel pumps, sales rose by 17.8%YoY.
EBITDA grew by 9.9% YoY to Rs 229 mn. EBITDA margins were stable YoY but improved substantially by 188bps QoQ to 7.0% due to improved performance from the TCI Seaways division. depreciation. Interest cost grew by 38.5% YoY to Rs 43 mn due to higher borrowings. Depreciation fell by 104.5% YoY to (Rs 2.5 mn) due to a change in the depreciation policy.
TCI's supply chain division has added new customers like ITC foods division, Ceat Tyres, P&G, Spinach, etc. TCI also added ~8.0 lac sq ft of warehouse space during FY08. XPS, the Courier division of TCI recorded a 20% growth.
Published by Komal M @ 10:52 AM IST.
IT spend strong amidst declining profits in US
Despite the ongoing sluggishness in American corporate profits (BFSI segment), overall US IT spending remained robust in 1Q08. Most Indian IT services companies have acknowledged delays/slowdown in ramps especially for Financial Services customers in 1H08, but expect a recovery in 2H08.Indian IT players continued their market share gains in the global arena with 35% YoY revenue growth in Q1-2008. Offshoring is likely to be the mega-trend for IT Services and expect Indian IT players to continue to gain market share.
Technology spending as a percentage of profits peaked in Q1-2000 and has constantly declined since then and is currently holding at 25-30% levels.
Published by Komal M @ 9:32 AM IST.
Inflation to Rise Post Hikes
Thursday, June 05, 2008Yesterday we reported about the hike in petroleum products and excise duties. Post-hike, the Wholesale Price Index is expected to rise by 55 bps only on account of the hike in these 3 products.
The hikes also meant increase in consumer's burden by Rs211 bn (US$4.9 bn or 0.39% of GDP) and the government will bear tax losses amounting to Rs226.6 bn (US$5.3bn or 0.42% of GDP) in F2009 (12 months ended March 2009).
The combined central plus state deficit including the off-budget expenditure items is expected to be about 8.9% of GDP in F2009 (from 9.3% earlier).
Published by Komal M @ 1:12 PM IST.
TRF Ltd - Temporary Blip of Slowdown ?
TRF's Q4FY2008 results were mixed bag - (1) revenue below estimates at Rs1.7 bn and 20% yoy growth and (2) net profit in line with estimates at Rs154 mn and 54% yoy growth. For FY2008, TRF reported net profit growth at 59% yoy to Rs322 mn and earnings of Rs58.4/Share, ahead of estimates. TRF is comfortably placed with Rs10 bn order backlog executable in next 24-30 Months. But, the quality of above order backlog is worrisome with presence of fixed price contracts.
Despite a below expected revenue growth, EBIDTA growth at 47% yoy to Rs228 mn was in line with estimates. We attribute this to 150 bps expansion in EBIDTA margins to 13.5% in the current quarter. This is largely driven by change in revenue mix with high margin Products Division contributing 25% of revenues in Q4FY2008 against 20% in Q4FY2007.
TRF has outstanding order backlog of Rs10 bn as on 31st March 2008.
Published by Webmaster @ 9:51 AM IST.
VIP Industries - Dismal Performance
Wednesday, June 04, 2008
VIP Industries declared its FY2007-08 numbers. Sales and PAT are 12% and 8% below consensus estimate. EBITDA margin stood at 9.9% as compared to estimates of 10.2%.Total standalone sales for Q4FY08 stood at Rs1.1bn, while consolidated sales for FY08 were at Rs5.7bn an growth of 9% YoY. EBITDA margin for the quarter were at 8.3% compared to 10.3% on standalone level. Consolidated EBITDA margin were at 9.9% Vs 8.5% meaning that integration of Aristocrat Luggage has started yielding results. Consolidated PAT before extra-ordinary item (VRS Account a drag here) stood at Rs 285mn(18% YoY), while post extra-ordinary item it was at Rs216mn (48% YoY).
We estimate VIP to report an earnings of Rs 7.45 for FY2009. VIP Industries retail venture planned to add 100 exclusive outlets and the company commanded ~50% market share in organized retailing of luggage merchandise.
Published by Sunil K @ 5:26 PM IST.
Sun Pharma - Good Growth
Sun Pharma reported Q4FY09 sales Rs12.5 bn (up 131% YoY), PAT Rs7.2bn (up 241%YoY). Results were dominated by the higher-than-expected Protonix shipments. EBITDA margin expanded to 58.9% in Q4FY08 from 28.4% in Q4FY07. The India formulations business grew 25%YoY in FY08 to Rs14.7bn while the ROW formulations business grew 30%YoY in FY08 to Rs2.6bn. The US business grew 164% YoY to Rs13.9bn driven by Trileptal exclusivity and the Protonix launch.
The management guidance is 18%-20% YoY growth for FY09 for the non-US business and expects 25% growth in the US business.Management reiterated that it is confident of getting the Effexor XR approval later this year but did not give any specific timeline.
EPS estimates for FY09 is between Rs 80 to Rs 82.50.
Published by Komal M @ 3:18 PM IST.
Hindustan Dorr-Oliver Result Analysis
Hindustan Dorr Oliver (HDO) as anticipated, reported robust numbers for the quarter ending March 2008. HDO's Q4 FY08 sales stood at Rs.1055.5 mn as against Rs.785.2 mn in corresponding quarter previous year, up by 34%.
Operating profits for Q4 FY08 at Rs 151.7 mn, up by 98% as against Rs.76.8 mn reported earlier. It reported an OPM of 14.4% for the quarter, the highest ever reported by the company.Interest expense for the quarter went up by 405% on account of higher working capital to support the growing sales and the capex that it is incurring at its facility at Vatwa.PAT of Rs.94.8 mn for the quarter as against Rs.67.5 mn in Q4 FY07, up by 40%.
HDO's current order backlog is greater than Rs.6.0 bn. Furthermore, its order pipeline is also strong. In the near-term, HDO is well-placed for a large order from Uranium Corp of India. The company has recently bagged Rs.2.5bn contract from Vedanta Group.
Published by Sunil K @ 2:52 PM IST.
Petroleum Product Prices Hiked
Breaking News:Updating from the corridors of Petroleum Ministry, following is the price hike and excise hike in petroleum products
Rs 3 /L hike in diesel price.
Rs 5 /L hike in petrol price.
Govt hikes LPG prices by Rs 50 per cylinder.
Customs duty on crude cut to nil.
Govt cuts excise duty on diesel, petrol by Rs 1 /L.
Customs other petro products cut to 5% vs 10%.
Govt cuts customs duty on petrol, HSD to 2.5% from 7.5%.
Excise duty cut to cost 66.60 bln rupees.
Duty cut on oil pdts to cost govt 226 bln rupees
Published by Komal M @ 12:14 PM IST.
Indo Tech Transformers - Earnings Tripped
Tuesday, June 03, 2008The net sales of ITTL declined by 17.7% to Rs 46.66 crore in Q4FY08 as against Rs 56.72 crore during Q4FY07. The net profit declined by 6.1% to Rs 9.66 crore in Q4FY08 as against Rs 10.29 crore during Q4FY07. Realization dropped by ~11.06% and raw material prices hiked because of which the company witnessed drop in PAT margin by ~280 bps on QoQ basis to 20.7%.
The company was busy in training and shifting people for commissioning the new plant because of which the company top line and bottom line declined by 17.7% and 6.1%.
On yearly basis, net sales of ITTL rose by 22% to Rs 189.5 crore in FY08 as against Rs 155.37 crore during FY07. The net profit rose by 48.9% to Rs 39.02 crore in FY08 as against Rs 26.21 crore during FY07.
The company’s order book position stands at ~Rs 154 crore with execution period of ~ 6 months. Out of which ~Rs 133 crore stands for power transformers, ~Rs 19.8 crore for distribution transformers and balance for dry type transformers.
Published by Komal M @ 11:10 AM IST.
Sobha Developers - Result analysis
Topline for the full year FY08 up by mere 20% compared to FY07. For 4QFY08 topline improved by 33% to 4741 mn compared to 3573 mn in 4QFY07. Increase in revenue can be attributed to better (average) realization from Rs. 2700 in FY07 to Rs. 3200 in FY08. The total area sold during FY08 increased by 37.4% compared to FY07.
Higher interest cost lead to a decline in net profit margins from 17% in 3QFY08 to 15% in 4QFY08. However on the back of better realization and increased volume, net margins for the full year increased by 200 bps from 14% in FY07 to 16% in FY08.
Sobha Developers Land bank stands at 4024 acres (230 mn sq. ft developable area) as on 31st March 08. Outstanding amount to be paid over next 2 years for the land acquired is Rs. 660 cr. Land bank is distributed as follows - Bangalore 1600 acres, Pune 170 acres, Hosur 700 acres, Cochin 500 acres, Chennai 500 acres, Gurgaon 228 acres and others 326 acres.
Average realization in 2007-08 was Rs 3,200 per sq. ft compared to Rs 2,700 sq. ft in 2006-07.
Published by Komal M @ 8:44 AM IST.
NTPC - Charging Ahead with Good Numbers
Monday, June 02, 2008NTPC's 4QFY08 Recurring PAT at Rs18.0bn was up 4% YoY. Reported PAT was down 23% YoY on account of exceptional foreign exchange fluctuation items of Rs4.7bn. The company does not expect similar items from FY09 on account of change in accounting.
NTPC's FY08 Recurring PAT at Rs75.0bn up 12% YoY was 7% below CIR estimates of Rs80.6bn on account of ~ Rs6bn of extra coal costs in 4QFY08 after Coal India hiked prices by 10%. These costs will be made up in the tariffs next year as this is a pass through item.
FY08 gross generation at 200.9 bkwh up 6% YoY was below CIR estimates of 209bkwh on account of delay in capacity addition and gas supply shortages.
Out of the 22,430MW of capacity the company expects to add in the XIth plan, 1,740MW has been commissioned, 16,930MW is under construction and 3,760MW is yet to be ordered. For FY09, we expect the company to report an EPS of Rs 10.98.
Published by Sunil K @ 12:45 PM IST.
