Equity Research
Pantaloon Retail – Future Group – Riding Retail SpendAugust 31, 2010
Pantaloon’s 4QFY10 revenues grew 91% yoy to Rs31.8bn. The underlying samestore sales growth (SSSG) for value retailing was 11%, while the lifestyle SSSG came was 19%. EBITDA grew 15% yoy to Rs2.1bn. PBT (pre-ex) grew 36% yoy to Rs750mn due to higher other income. Tax reversal led to adjusted PAT growth of 154% to Rs927mn.
Lifestyle-retailing delivered SSS growth of 19.4% YoY on a normal base quarter. Valueretailing SSS grew 11.5% YoY – marginally slower growth than in 3QFY10, but on a much stronger base quarter. Home-retailing SSS grew 57% YoY on a very weak 4QFY09, Read More »
Unichem Laboratories – ReviewAugust 26, 2010
Motilal Oswal, the fundamentals research company has initiated coverage on Unichem Laboratories with a BUY Rating. Here is the justification on the same.
The Indian pharmaceuticals industry is likely to grow at 12-15% compounded average growth rate (CAGR) over FY10-FY12E after having grown by 14% CAGR over the last 15 years. Unichem’s domestic business, which contributed 81.5% to revenues in FY10, had a market share of 1.5% and is currently ranked 25th.
Strong brands power domestic growth – Read More »
Buy IL&FS Transportation Networks – GSAugust 23, 2010
Goldman Sachs has initiated Coverage on IL&FS Transportation Networks – ITNL with a BUY Rating. ITNL has 1,673 lane kms of road projects under construction and 3,683 under development as of March 31, 2010. We believe this will result in a sustained revenue stream from BOT project-related services, growing at 43% CAGR over FY10-FY13E. Expect 5 projects worth Rs77 bn (2 awarded in FY10 and 3 in 1QFY11) to achieve financial closure in the medium term, thus augmenting its financial and operational ability. Read More »
Indian Markets / Economy & Macro / Sector Research
SEBI – IRDA – Finance Minsitry – Total DisconnectAugust 24, 2010
The Pillars of Indian Capital Market – SEBI, IRDA and the Supreme Veto Authority, the Finance Ministry are somewhat disconnected in their recent actions and functioning.
It all began with Mr. C.B.Bhave the Chairman of SEBI tightening the rules for errant Agents / brokers in the Mutual Funds and Insurance industry. Since AMFI, the body overlooking Mutual Funds was meek, SEBI overpowered and to an extent cleaned the mess of funds churning and underhand commissions AMCs were rolling out at the cost of investors. SEBI introduced a regime of Zero entry load, a good move. However, recent implementation of compulsory KYC is uncalled for as the systems that approve KYC reject an application if there is a single mis-match of a “letter” anywhere in your address putting investors at loss. Standardize PAN card for now is our opinion.
Mr. Bhave knows the Day Light Loot Insurance Agents have been resorting to by ripping commissions as high as 20% on ULIP Policies. Read More »
Earnings Hit High – Heading Higher – MorganAugust 19, 2010
The earnings season looked tepid – but the headline numbers hide the underlying strength. For example, excluding ONGC, Bharti and RCom, Sensex earnings were up 36%, its best performance in four years. The quality of earnings was also quite strong – net financial income’s share in pre-tax earnings fell to a near 8-year low.
Earnings growth in the broad market (3,038 companies) slowed down (as expected), though it was particularly damaged by the
energy sector (ex-energy growth was at 22%). Earnings at the aggregate level appeared to be in line with expectations — though Read More »
August 5, 2010
We are in a situation where earnings risk and valuation risk seem to be prevailing simultaneously. Large cap stocks in most sectors appear fully valued and the market is trading close to top of its trading range. Simultaneously, Sensex EPS estimates have declined 2-3% during the recent quarterly result season.
The narrow market (i.e., BSE Sensex) is lagging the broad market on profit growth. Slightly more than half of the reported companies Read More »
Corporate Earnings News
New Direct Tax Code BillAugust 30, 2010
We have been able to obtain a copy of the Direct Tax Code Bill as Introduced by the Government in the Lok Sabha. As discussed earlier by our Analysts, the content in the new bill is very similar. Major Changes apart from what is already discussed is,
- Applicable from 1st March 2010. That means it will be applicable for Citizens filing IT returns on or after April-1st 2013.
- 5% Dividend Income Distribution tax to be Paid by MutualFunds [AMCs] and ULIPs [Insurance companies]
Pranab Mukherjee Does U Turn on Direct Tax Code
August 27, 2010
Finance Minister Mr. Pranab Mukherjee did a complete “U” turn on the Direct Tax Code Bill. The first draft released in August-2009 [See here] had proposed some very drastic changes raise the individual income tax limits in 3 big slabs of 1.6 Lakhs to 10 Lakhs, 10 Lahks to 25 Lakhs and 25 Lakhs & above. Get rid of all exemptions as well as total savings was encouraged to take it upto Rs 3 lakhs.
The Second draft [See here]had also proposed to tax capital gains from stock markets currently 100% exempt. However, the Read More »
IPO Reviews
Winners and Losers – AnalysisAugust 19, 2010
A total of 27 companies which were listed during the period have been examined. During this period ~INR 24832 crores has been raised from the primary market. Taking over-subscription into consideration around ~INR 1, 54,449 has been applied for these IPO’s.
On an average these IPO’s were over-subscribed 6.2x while if we remove NMDC (which was the biggest IPO at INR 9966 crores and was oversubscribed only 1X) from the over-subscription list, the over-subscription would go up to 9.5x. Read More »
What 25% Free Float means to Markets ?
June 7, 2010
Government raises threshold for public shareholding in listed companies: The Indian government today amended the Securities
Contracts (Regulation) Rules, making it mandatory for listed companies to have a minimum public holding of 25%.
We present below a sort of the broad based BSE 500 index which indicates that the following companies have a public holding of less than 25% and will have to comply with the change in regulation over the next few years. Read More »
Mutual Funds in India
AUM + Portfolio Moves Update for JuneJuly 19, 2010
Indian Equity MFs AUM, at INR 2.14 tn, accounted for ~34% of total AUM. Aided by the rally in broader markets, equity AUM rose ~4% over the previous month. Sales in existing equity schemes stood at ~INR 40.3 bn in June against ~INR 54 bn in May. New fund offerings (NFOs) of equity schemes of ~INR 10.7 bn during the month.
Total AUM stands at INR 6.3 tn. It dipped by ~INR 1 13 tn over the previous month. Ratio of large-cap AUMs to mid-cap AUMs Read More »
Axis Triple Advantage Fund – ReviewJuly 2, 2010
Axis Triple Advantage Fund, seeks to help investors take advantage of the benefits of diversification by investing in a mix of three asset classes viz. Equity, Bonds and Gold.
Equity – Long Term Growth Stocks – Most volatile with a 30-40% allocation
Bonds – “Classical” diversification in portfolio Low risk compared to stocks with 30-40% allocation Read More »
Feeds & Updates
