Indian Equity Research and Investment Strategy
JISL reported 4QF10 results with revenue, EDITDA, and adjusted PAT growing at 37%, 28% and 150%, respectively. Revenue growth was driven by 46% and 74% growth in the MIS – Micro Irrigation and Fruit processing businesses, respectively. EDITDA margins contracted by 160 bps, primarily because of a sharp dip in the profitability of agro processing business.
Micro irrigation grew 46% yoy despite flat performance in Andhra Pradesh. Margins were stable at 32.3% vs last year. (more…)
Bajaj reported 4QFY10 PAT of Rs5.3 bn, comfortably beating our PAT estimate of Rs4.5 bn. The upside was largely operational with EBITDA margins coming in at 22.9% for the quarter compared
to our estimate of 21.5%. The margin upside was driven by better-than-expected realizations and lower other expenditure. Net realizations increased 4% qoq, higher than our expectation of 2%, driven by higher mix of Pulsar brand sales and price increases.
Other expenditure declined 18% sequentially, which the company attributed to better cost control and lower advertisement spend. (more…)
April despatch growth at 8.9% yoy; down 7.6% sequentially April cement despatches came in at 18.1 mn tonnes, up 8.9% yoy, down
7.6% mom – this is 3rd straight month of single-digit growth in cement demand.
As we enter the phase of seasonally muted demand growth with the onset of monsoons, we believe there could be downside risks to our FY11 forecast of 11% growth. Additionally, we could see demand growth tapering off in the north, as construction activity led by (more…)
Ranbaxy reported 1Q PAT of Rs9.6bn, on exclusivity sales of Valtrex, US$50m (Rs2.3bn) income from Flomax settlement & forex gains of Rs4.5bn. Besides one-offs, base biz trends appear strong with most markets growing, despite a 6% INR appreciation. While EBITDA margins were skewed by exclusivity sales, cost containment measures seem to have borne fruit as SG&A costs declined QoQ.11.
Ranbaxy’s 1Q results reflect its ability to monetize its FTF pipeline despite its issues in the US. Both Valtrex & Flomax have (more…)
Hindalco Industries’ (Hindalco, standalone) Q4FY10 net revenues, at INR 54.0 bn, were below our expectation of INR 58.2 bn. EBITDA, at INR 8.35 bn, was below estimates due to preponed shutdown of copper smelter for 38 days leading to ~15 kt of lost production. However, net profit, at INR 6.6 bn, was above our estimate of INR 5.5 bn due to higher-than-expected other income and tax write-back of INR 1.1 bn. (more…)
We wrote over the weekend explaining the crisis in Greece and Europe. Though India is not secluded because its investor base comprises of those FIIs who have exposure to several markets across the globe.
Lets analyze key economic parameters of India first and then see its impact on the markets. India’s European export exposure is limited to 3% of GDP. India’s public debt, at 75% of GDP, is close to peripheral Europe’s. The key difference? (more…)