Result Reviews

Mphasis - 1QFY2013

Mphasis announced its 1QFY2013 numbers which underperformed our expectation on the revenue as well as operating front. The dollar revenues came in at US$238mn, down 3.9% qoq, due to decline in onsite volumes on account of holiday season which resulted in shutdown for few days. Revenues from the direct channel grew by 1.0% while revenues from the HP channel declined by 3.9% qoq. In INR terms revenues came in at `1,257cr, down 3.8% qoq. The company again witnessed headcount reduction in Application as well as ITO business by 173 and 15 employees, respectively. The EBITDA margin of the company declined by 215bp qoq to 18.5%. PAT came in at `184cr, down 12% qoq. The company added 22 new clients during the quarter, out of which 14 were added in direct channel. The company remained committed to increase revenues from the direct channel. Source: AngelBroking

ITD Cementation - 4QCY2012

For 4QCY2012, ITD Cementation reported a disappointing set of numbers. The top-line for the quarter declined by 4.0% yoy to `313cr against our estimate `350cr. The company's operating margin contracted by 301bp yoy to 10.5% mainly because of higher employee cost. Major disappointment came on the profit front which stood at `1cr, 88.9% lower on a yoy basis and 77.7% lower than our expectation of `6cr, mainly due to the contraction in the operating margin. However, recently the JV of ITD Cementation with its parent company, ITD, has bagged an order of `546cr from Delhi Metro Rail Corporation (DMRC). The order is scheduled to be completed in 30 months. ITD cementation (standalone) is also expecting an order worth ~`115cr in Ghaziabad for the construction of flyovers with scheduled completion in 15 months. The stock has witnessed a major correction recently and is currently trading at a PBV of 0.5x. Source: AngelBroking

Banking - 3QFY2013 Result Review

3QFY2013 snapshot - Asset quality stress continues, as slippages remain elevated; but the extent of asset quality deterioration shows diminishing signs: Annualized slippage ratio for PSU banks under our coverage moderated to 2.8%, from 3.5% in 2QFY2013. Considering different disclosure practices being followed by banks, wherein some net-off any inter-quarter movement of NPAs, while some don’t, to corroborate our understanding that the extent of asset quality deterioration is increasingly reflecting diminishing signs, during 9MFY2013 the increase in annualized slippage ratio was 43bp yoy, lower than the increase of 91bp yoy witnessed in 1HFY2013. Most of our coverage PSU banks witnessed moderate performance on the recoveries & upgrades, which led to an 8.0% qoq increase in gross NPAs for them. Private banks continue to perform relatively much better vis-à-vis PSU banks on the asset quality front, as they not only reported sequentially lower slippages, but also posted better recoveries and upgrades performances, which aided them to limit the sequential increase in their gross NPA levels to just 1.2% in 3QFY2013, much lower compared to an increase of 3.7% witnessed in last quarter. Asset quality pressures continued to reflect on the sector’s margins during the quarter, as nearly half of our coverage banks reported sequentially lower margins, primarily due to higher interest reversals/lower income recognition during 3QFY2013 on increased slippages/elevated gross NPA inventory.Overall, PSU banks reported a weak performance during 3QFY2013, as interest reversals/lower interest recognition and higher provisioning led to a 5.1% yoy decline in bottom-line. Private banks continued to report impressive performances, with an operating profit growth of 25.1% yoy. On the earnings front, new private banks reported a strong growth of 28.7% yoy, while old private banks witnessed a healthy growth of 20.3% yoy. Given the economic environment, continue to prefer Private banks: Decelerating economic growth environment, policy woes in select sectors and elevated inflation and interest rates point towards further economic stress and are not suggesting any conclusive trigger for improvement in asset quality in the near-term. Hence, we prefer private banks, given their favorable cyclical and structural outlook, with Axis Bank and ICICI Bank being our top picks. But with the risk of higher competitive intensity in light of higher number of likely new entrants, the upsides are expected to be relatively more moderate than estimated earlier.Due to cyclical macro concerns, PSU banks are already trading at depressed valuations. Even, higher number of likely new entrants in the sector, create a structural impediment for PSU banks’ medium-term re-rating, as we expect them to lose market share in any case, considering their capital crunch. Upsides in these stocks would largely depend on an eventual economy turn-around, which would lead to lower re-pricing of high-cost deposits (relative benefit for low-CASA banks) and higher recoveries (relative benefit for banks that have experienced maximum asset quality pain, and importantly, also provided for it already). Screening for these criteria, as well as Tier-1 capital adequacy and trailing adjusted valuations, in our view, PSU banks that would stand to gain the most from an eventual turn-around include State Bank of India (SBI) and Punjab National Bank (PNB) among the large-caps and United Bank, Corporation Bank and Indian Bank among the mid-caps. Asset quality pressures continue to reflect on margins Asset quality pressures continue to reflect on the banking sector’s margins during the quarter, as nearly half of our coverage banks reported sequentially lower margins. Canara Bank (CANBK), Bank of Baroda (BOB) and Federal Bank (FEDBK) witnessed the highest sequential margin compression; primarily due to higher interest reversals/lower income recognition during 3QFY2013 on increased slippages/elevated gross NPA inventory (slippages for BOB and FEDBK were higher by 40.9% and 193.1% qoq, respectively). Source: Angel Broking

Result Update 4QCY2012

Sanofi

For 4QCY2012, Sanofi India reported mostly in-line results at the top-line front, while the net profit came in below our expectations. Sales grew by 18.6% yoy, while the net profit grew by 24.1% yoy mainly on back of higher deprecation. Sanofi’s net sales grew by 18.6% yoy to `401cr for 4QCY2012, mostly in-line with our estimate of `389cr. The company reported a gross margin of 49.7% (49.2% in 4QCY2011), lower than our estimate of 51.7%. Consequently, the OPM came in at 12.7%, lower than our estimate of 19.8%. The net profit came in at `45cr, up by 24.1% yoy, just- in-line with our estimate of `59.4cr. We expect net sales to post a 13.3% CAGR to `1,917cr and EPS to register a 13.4% CAGR to `99.1 over CY2012–14. At current levels, the stock is trading at 25.0x and 23.3x CY2013E and CY2014E earnings, respectively. Source: Angel Broking

Result Update 3QFY2013

Bosch

Bosch (BOS) reported poor results for 4QCY2012 largely due to contraction in operating margins which declined 82bp sequentially (429bp yoy) to 12.5%. Topline posted a subdued growth of 5.1% yoy (3.8% qoq) to `2,132cr, which was slightly below our expectations of `2,202cr. The poor performance can be attributed to the weakness in the medium and heavy commercial vehicle (MHCV) and tractor industries which are the key drivers of the company’s performance. While the automotive segment posted a growth of 3.9% yoy (4.7% qoq) due to slowdown in OEM sales; non-auto segment registered a 6.2% yoy (down 2.7% qoq) growth. On the operating front, EBITDA margin declined by a sharp 429bp yoy to 12.5% primarily on account of increase in raw-material costs and employee expenditure. The raw-material cost as a percentage of sales surged 140bp yoy on account of INR depreciation; while, employee expenditure as a percentage of sales jumped 290bp yoy due to negative impact of change in actuarial assumptions and wage hikes given to the employees. On a sequential basis, the margins were impacted largely due to increase in employee and other expenditure which grew by 18.7% and 27.1% qoq. Therefore, net profit at `172cr (down 38.8% yoy and 15.2% qoq) was lower than our expectations of `199cr. The net profit performance was further impacted due to high depreciation expense (up 33.7% yoy) and higher tax rate (29.7% vs 22.5% in 4QCY2012). At the CMP of `8,862, the stock is trading at 19.4x CY2014 earnings. Source: AngelBroking

Goodyear India 

For 4QCY2012, Goodyear India reported a lower-than-expected top-line of `384cr, marginally lower on a yoy basis from `395cr in 4QCY2011. While for the full year CY2012, revenue declined by 2% yoy to `1,486cr due to slowdown in auto industry. Increase in other expenses led to contraction of EBITDA margin by 248bp yoy from 8.7% in 4QCY2011 to 6.2% during the quarter. Consequently, net profit for the quarter declined by 20.7% to `16cr from `20cr in 4QCY2011. EBITDA margin for CY2012 contracted by 39bp to 7.1%, inspite of a decline in raw material cost, which was offset by higher employee expense. Thus, net profit for CY2012 declined by 14.9% yoy at `56cr from `66cr in CY2011. Source: AngelBroking

Result Update 3QFY2013

Ranbaxy

For 4QCY2012 Ranbaxy Labs posted numbers above expectations on the topline front, while it reported lower-than-expected numbers on the profit front. On the sales front, the company reported a 28.8% decline to end the period at `2,671cr vs our expectation of `2,525cr. The main disappointment came on the OPM front which came in at 3.4% vs our expectation of 9.3%. In addition to this, contractual expenses along with the forex losses amounted to an  obligation of `506cr and `281cr respectively. This lead the company to post an adj. net loss of around  `154cr vs an expected net profit of  `274cr. Source: AngelBroking

Vesuvius India

For 4QCY2012, Vesuvius India (VIL) reported better-than-expected results. Its topline grew slightly by 3.5% yoy to `154cr, and 10.6% higher than our expectation of `139cr. For the full year CY2012, revenue grew by a marginal 3.8% yoy to `564cr. EBITDA margin expanded by 298bp yoy to 19.3% for the quarter from 16.3% in 4QCY2011 mainly due to reduction in other expenses. Consequently, the net profit for the quarter grew by 33% yoy from `13cr to `18cr in 4QCY2012.  Source: AngelBroking

Results Update 3QFY2013

ONGC - RU3QFY2013

ONGC reported better than expected 3QFY2013 results. The company’s top line increased by 15.7% yoy to  `21,093cr (above our expectation of  `19,294cr). ONGC’s crude oil net realization increased by 6.7% yoy to US$47.9/bbl and gas realizations increased 10.5% yoy to 8.4/scm due to INR depreciation against the USD. Crude oil sales volumes grew 7.0% yoy to 6mn tonnes while gas sales volumes remained flat yoy at 5bcm. The company shared a subsidy burden of `12433cr in 3QFY2013. The company's EBITDA increased by 5.4% yoy to `11,342cr. Other income grew by 33.7% yoy to  `1,280cr which resulted in adjusted net profit growing by 54.5% yoy to `5,562cr (above our expectation of `4,843cr). The company has maintained its oil/gas production guidance to 27.0mn tonnes/25.7bcm and 29.1mn tonnes /26.4bcm for FY2013 and FY2014, respectively. Source: Angel Broking

JaiPrakash Associates - RU3QFY2013

For 3QFY2013, Jaiprakash Associates posted mixed set of numbers with strong performance on revenue however earnings were lower than our estimate owing to lower-than-expected operating performance On the top-line front, company’s reported revenue of  `3,431cr in 3QFY2013, registering a growth of 15.5% yoy which was higher than our estimate by 4.3%. The cement segment had growth of 7% on a yoy basis while construction segment and real estate revenue grew by 2.7% and 98.9% on a yoy basis respectively. Blended EBITDA margins decline by 603bp/395bp on a yoy/qoq basis to 23.2% and was below our expectation of 25.9%. Cement margins came in at 8.0% which led to decline in margins. Interest cost stood at  `533cr a jump of 20.7%/14.7% on yoy/qoq basis and marginally higher than our estimate of `478cr. Depreciation cost came at `181cr a jump of 9.9% on yoy basis. On the bottom-line front, company reported a PAT `111cr a dip of 64.2% on a yoy basis owing to lower-than-expected at operating level and high interest cost. Source: Angel Broking

Britannia Industries - RU3QFY2013

Britannia Industries posted a 16.8% yoy growth in standalone topline to `1,453cr, which was in-line with estimates. The topline growth was aided by price hikes carried out by the company. OPM fell by 20bp yoy to 6.4%. Net Profit rose by 5.4% yoy to `57cr. Source: Angel Broking

Indraprasth Gas - RU3QFY2013

Indraprasth Gas reported robust 3QFY2013 results. Net sales grew by 31.1% yoy to  `869cr which was driven by increases in both, sales as well as realizations. CNG and PNG volumes increased by 7.6% and 17.4% yoy to 194mn kg and 84mmscm, respectively. Average CNG realisation increased 20.0% yoy to `38/kg, whereas average PNG realizations increased by 11.3% yoy to  `26/scm. EBITDA increased by 24.9% yoy to `188cr. However, EBITDA margin slipped 107bp yoy to 21.6% due to higher cost of gas purchases. Further, interest expense was flat yoy at `14cr in 3QFY2013. Tax provisions for this quarter were also higher at 32.4% compared to 31.9% in 3QFY2012. Hence, net profit grew by 24.3% yoy to `86cr.  Source: Angel Broking

Hexaware - RU3QFY2013

For 4QCY2012, Hexaware reported broadly in-line set of results. The USD revenue came in at US$92.4mn, down 0.4% qoq. In INR terms, revenue came in at  `502cr, down 1.0%. The company’s EBITDA and EBIT margin declined by ~480bp qoq each to 16.9% and 15.1%, respectively. Margin decline was less than expectations as well as less than management’s guidance of ~500-700bp qoq. PAT came in at `66cr. Management has guided for double digit revenue growth in CY2013 and indicated intention to retain ~50% dividend payout ahead. Management has given 2-3% qoq USD revenue growth for 1QCY2013 and expects margins to improve by ~150-200bp qoq in 1QCY2013. The company expects growth to be driven by aggressive client mining outside of top 10 clients and BFSI vertical. We continue to remain positive on the stock and the target price in currently under review. Source: Angel Broking

Punj Lloyd - RU3QFY2013

For 3QFY2013, Punj posted mixed set of numbers with muted performance on revenue and EBITDAM front, however higher share of profits from associates led to a profit at earnings level. The company reported a flat top-line growth of 2.6% yoy to  `2,881cr in 3QFY2013. EBITDA margins showed an improvement of 431bp yoy to 10.1% in 3QFY2013. For the quarter, interest cost increase by 22.2% yoy to `198cr while depreciation came in flat at  `88cr respectively. On the bottom-line front, PAT came in at `9cr in 3Q FY2013 vs.  `70cr in 2QFY2013. This was mainly due to higher share of profit from associate (`8cr vs. a loss of  `5cr in 2QFY2013). Source: Angel Broking

GIPCL - RU3QFY2013

For 3QFY2013, GIPCL reported sluggish top-line performance in-line with our expectations. Top-line declined by 4.8% yoy to  `369cr, in spite of 6.6% yoy increase in power generation. OPM expanded by 1,344bp yoy to 37% mainly on account of 1,207bp yoy reduction in fuel cost. The company posted robust growth in net profit to  `70cr (v/s  `17cr in 3QFY2012) aided by margin expansion and lower tax provision. Source: Angel Broking

Dishman Pharma - RU3QFY2013

Dishman Pharma reported sales mostly in line with expectations, while the net profit came in below expectations. The top-line grew by 19.6% to `318cr , mostly in line with expectations of  `315cr during the quarter 3QFY2013. The top-line growth was mainly driven by the CRAMS, which grew by 23.8%, while MM grew by 12.4% yoy. The OPM came in slightly lower than expectations at 19.1%, a 120bp decline. This along with high interest expenses led the net profit to come in at `16.4cr, almost same as `16.7cr. Source: Angel Broking

Godawari Power and Ispat - RU3QFY2013

Godawari Power and Ispat (GPIL) reported healthy 3QFY2013 results. The company’s net sales grew by 25.3% yoy to  `603cr on account of higher sales volumes of Billets, HB wire and ferro alloys partially offset by lower realizations. On the operating front EBITDA margin was flat at 11.6% and EBITDA grew by 24.9% yoy to  `70cr. Interest expenses increased by 8.9% yoy to  `30cr however, net profit increased by 75.8% yoy to `20cr. Source: Angel Broking

Sun Pharmaceuticals - RU3QFY2013

Sun Pharmaceutical Industries (Sun Pharma) reported a much higher-thanexpected 3QFY2013 performance. Its net sales reported a 33.0% yoy growth. The Adj. net profit grew by 31.9% yoy, driven by a higher-than-expected improvement in sales and a higher-than-expected expansion in the OPM, which in at 44.2% V/s expectation of 40.6%. Source: Angel Broking

M&M - RU3QFY2013 

Mahindra and Mahindra (MM) reported slightly lower-than-expected bottom-line performance for 3QFY2013 primarily due  to the contraction in EBITDA margins led by sequential decline in net average realization. The top-line registered a strong growth of 28.5% yoy (9.8% qoq) to `10,774cr; however it was lower than our expectations of `11,070cr largely due to the sequential decline in net average realization in the AS (1% qoq) and farm equipment segment (FES, 1.3% qoq). The top-line growth on a yoy basis was driven by a robust volume (17.5% yoy) and net average realization growth in the AS (22.5% yoy). Total volumes, however, posted a growth of 10.9% yoy (10.8% qoq) as tractor sales witnessed a decline of 1.6% yoy on account of weak domestic demand. The EBITDA margins contracted 96bp yoy (16bp qoq) to 11.2% owing to raw-material cost pressures, which as a percentage of sales increased 153bp yoy (97bp qoq) to 75.9%. As a result, bottom-line came in at `836cr, a growth of 26.3% yoy; however it was down 7.3% qoq largely due to absence of dividend income from the subsidiaries. The bottomline benefitted from the reduced tax rate on account of higher R&D spends.  We broadly retain our top-line and EBITDA margin estimates for FY2013/14. However our earnings estimates are revised slightly upwards to factor in the lower tax-rate going ahead as guided by the management. We expect AS to drive the total volume growth of the company led by the success of the new launches (XUV5OO, Quanto and Rexton) in the utility vehicle (UV) segment. We expect tractor volumes to recover in FY2014 and clock a growth rate of 8% after posting a decline of 4% in FY2013. At `883, MM is trading at 13.7x FY2014E earnings. Source: Angel Broking

Hindalco - RU3QFY2013

Hindalco’s reported lower than expected performance both on the top line and bottom-line front. Hindalco’s  net sales grew 3.0% yoy to  `6,790cr (below our estimate of  `7,199cr) mainly on account of lower than expected volumes. In aluminium segment, both alumina and aluminium production fell by 5.0% yoy each to 326kt and 139kt respectively. The downstream sales stood at 59kt. Aluminium segment net sales declined by 0.9% yoy to  `2,215cr mainly due to lower production at the Belgaum refinery due to lack of bauxite availability. In copper segment, copper cathode production decreased by 4.3% yoy to 84kt whereas CCR production declined by 3.7% yoy to 37kt. However, the Copper segment net sales increased by 5.5% yoy to `4,661cr.  On the operating front, aluminium segment EBIT decreased by 33.4% yoy to `206cr due to decrease in realizations coupled with increase in fuel and power costs. Nevertheless, Copper segment EBIT however improved by 4.3% yoy to `225cr. Overall, Hindalco’s EBITDA declined by 18.6% yoy to `582cr and EBITDA margin slipped 228bp yoy to 8.6% during 3QFY2013. Interest expenses increased substantially by 113.0% yoy to  `169cr on the back of new bonds raised during 1HFY2013. Other income was also higher by 93.2% yoy to `174cr. The company reported an exceptional item of `144cr related to some write-backs. Consequently, adjusted net profit declined by 35.8% yoy to  `289cr (below our estimate of `404cr). The company aims to start the Mahan smelter by April 2013 while it is in the process of commissioning Utkal refinery by March 2014. At current aluminium prices, we anticipate Mahan smelter to make loss during FY14 as it will not be able to commence coal production from the Mahan coal block until atleast 18 months in our view. Source: Angel Broking

Canara Bank - RU3QFY2013

Canara Bank reported subdued operating performance, as its pre-provisioning profit declined by 3.8% yoy, which was in-line with our expectations. Asset quality pressures continued for the bank during the quarter, as slippages remained elevated, which resulted in 24.9% yoy increase in provisioning expenses and hence the bank witnessed 18.9% yoy decline in its bottom-line. At the current market price, the stock trades at cyclically moderate valuation of 0.8x FY2014E ABV  vs. eight-year average of 1.1x and range of 0.7-1.4x. Source: Angel Broking

Cadila Healthcare - RU3QFY2013

Cadila Healthcare reported below expected numbers for 3QFY2013, except on the sales front. The company’s sales for the quarter were just-in-line with estimates at `1,561cr.On the operating front, the gross and operating margins came below expectations. This along with, a higher tax expense during the quarter resulted in net profit coming in a tad lower than expectations. Overall, the Adj. net profit came in at `103cr, a dip of 31.0%. Management expects the company to be US $3bn by 2015. Source: Angel Broking

Bharat Forge - RU3QFY2013

Bharat Forge (BHFC) reported disappointing performance for 3QFY2013 led by severe weakness in the domestic as well as the export markets which resulted in a volume decline of 32.4% yoy (19.1% qoq). For 3QFY2013, standalone revenue posted a significant decline of 28.5% yoy (22.5% qoq) to  `673cr led by 22.1% (9.3% qoq) and 33.2% yoy (33.5% qoq) decline in domestic and export revenues respectively. BHFC witnessed significant decline in revenues across all the geographies with the key markets of India, US and Europe experiencing a decline of 24%, 24.2% and 42.4% respectively.  The net average realization however, registered a growth of 6.1% yoy as it benefitted from the higher share of machining component. On the operating front, margins contracted 424bp yoy (124bp qoq) to 21.2% which was below  our estimates of 23.3% primarily on account of lower utilization levels (~50% in domestic operations). The company also initiated production cuts in an attempt to reduce inventories and align production levels with the demand environment. Hence operating profit and net profit registered a sharp decline of 40.5% (26.8% qoq) and 53.9% yoy (48.5% qoq) respectively. BHFC also posted a disappointing performance in its wholly owned overseas subsidiaries (wos) with top-line registering a decline of 2.2% yoy. BHFC posted a net loss of  `6cr at wos as against a profit of  `1cr in 3QFY2012. Even the subsidiary in China posted a net loss of `12cr during the quarter. The subsidiaries performance continues to be impacted due to the lower utilization levels caused by downturn in the heavy truck market in China and decline in demand in Europe. At `219, the stock is trading at 9.5x FY2014 earnings. Source: Angel Broking

Gujarat State Petronet - RU3QFY2013

Gujarat State Petronet Ltd (GSPL) reported disappointing 3QFY2013 results. Total operating revenues decreased by 2.8% yoy to `266cr mainly due to decline in transmission volumes, partially offset by higher tariffs. Transmission volumes for 3QFY2013 decreased by 16.0% yoy to 27.56mmscmd whereas transmission tariffs increased by 15.5% yoy to  `1/scm. EBIDTA also decreased by 4.9% yoy to `239cr mainly due to higher operating expenses. Depreciation expenses rose by 3.8% yoy to `48cr. Tax rate declined marginally to 33.0% in 3QFY2013 compared to 33.9% in 3QFY2012. Hence, PAT decreased by 5.7% yoy to `119cr. Source: Angel Broking

BGR - RU3QFY2013

For 3QFY2013, BGR Energy's (BGR) top-line growth came in flat yoy at  `805cr. The 22% yoy decline in revenue from the Capital Goods segment at `59cr (`75cr in 3QFY2012) was offset by a 2.4% yoy growth in revenue from the Construction and EPC segment at `746cr (`729cr in 3QFY2012). On the operating front, the EBITDA margin contracted by 259bp yoy to 13.7%, mainly on account of a 289bp yoy contraction in margin of the Construction and EPC segment. Interest cost grew by 9% yoy to `50cr (owing to elevated interest rate scenario and enhanced working capital requirements). Consequently, the net profit declined by 24% yoy to  `41cr. Source: Angel Broking

NCC - RU3QFY2013

For 3QFY2013, NCC posted poor performance on the revenue front; however higher other income due to asset sale and lower tax expense help boost the bottom line growth. On the top line front, NCC reported a decline of 6.3% yoy to `1,184cr, which was significant lower than our estimate of  `1,427cr. On the EBITDAM front, the company’s EBITDA  margins stood at 7.2% (down 116bp sequentially), which were below our estimate of 8.4%. This was mainly on back of lower-than-expected execution during the quarter. Interest cost came in at `99cr a decline of 7.6% on a yoy basis. On the bottom line level, NCC reported PAT of `11cr (was in line with our estimate of `11cr) against a loss of 9cr in 3QFY2012 owing to higher other income and lower tax expense. The current outstanding order book of NCC stands at  `18,799cr, with order inflow of  `3200cr till date. Source: Angel Broking

Subros - RU3QFY2013 

Subros posted better-than-expected results for 3QFY2013 driven by a strong volume growth of 30.7% yoy (41.1% qoq) leading to a 28.6% yoy (17.1% qoq) growth in the top-line. The volumes during the quarter were boosted by the festival demand and also due to the low base of last year. The 3QFY2012 volumes were impacted due to the strike at one of its largest customer, Maruti Suzuki. The EBITDA margin jumped 346bp yoy to 10.3% primarily due to the operating leverage benefits. On a sequential basis too, it expanded by 77bp. Hence, operating profit grew by 94% yoy (26.6% qoq) to `33cr. Led by strong operating performance, the net profit stood at `6cr as against `2cr in 3QFY2012 and `3r in 2QFY2013. At  `28 the stock is trading at 5.5x FY2014E earnings. Source: Angel Broking

Cravatex - RU3QFY2013

Cravatex reported poor set of numbers for 3QFY2013. Top-line plunged by 42.6% yoy to `49cr on a consolidated basis on account of order lumpiness in the same quarter previous year. Net sales from International segment and domestic segment fell significantly by 68% (due to high base effect) and 39% yoy. The contribution from the domestic sales has increased from 83% in 3QFY2012 to 89% in 3QFY2013. On the operating front the EBITDA dip by 32.7% yoy to `4cr. However the EBITDA margins expanded by 109bp yoy mainly on account of 52.2% lower raw material cost. On the segmental front, the EBIT margin for the domestic segment contracted by 20bp yoy while the international segment reported a margin of 5.7%, higher by 203bp yoy. The company reported a bottom-line of `1.4cr, low by 52.3% yoy. Source: Angel Broking

SBI - RU3QFY2013

State Bank of India reported subdued operating performance for 3QFY2013, as its net interest income (NII) and operating profit declined by 2.7% and 4.2% yoy, respectively. The bank has been aggressive in cutting its lending rates, so the decline in NII, was in-line with our expectations. The bank witnessed continued pressures on the asset quality front, as elevated slippages and sequentially lower recoveries/ upgrades resulted in 8.6% sequential increase in gross NPA levels, with net slippages being about `800cr higher than our estimates. As a result, in spite of slightly higher provisioning expenses than estimated by us, provisioning coverage ratio declined by about 130bp sequentially. At the current market price, the stock is trading at 1.4x FY2014E ABV (adjusting for value of subsidiaries 1.3x FY2014E ABV) vis-à-vis its historic range of 1.3–2.3x and median of 1.6x. Source: Angel Broking

Tata Motors - RU3QFY2013

For 3QFY2013, Tata Motors (TTMT) bottom-line performance was significantly lower-than-expected led by higher depreciation expense (up 29.8% qoq), forex  loss of `174cr and higher tax rate (at 38.7% as against 32% in 2QFY2013). The top-line performance too was lower-than-expected due to unfavorable product-mix at Jaguar and Land Rover (JLR) and standalone operations which resulted in a sequential decline in net average realization. The standalone operations posted a loss (adjusted) of `450cr, against our expectations of a loss of `25cr, primarily on account of dismal operating performance (EBITDA margins deteriorated to 1.4% on higher discounts and marketing spends in the passenger vehicle and medium and heavy commercial vehicle business and lower utilization levels). The consolidated top-line registered a modest sequential growth of 6.2% to `46,090cr, which was below our estimates of  `49,094cr on account of lowerthan-expected top-line in the JLR and standalone operations. The JLR top-line (up 15.7% qoq) was impacted mainly due to 5.5% qoq decline in net average realization led by unfavorable product-mix (higher share of  Evoque and Freelander). The standalone top-line (down 14.8% qoq) too was below our estimates on account of inferior product-mix (higher share of light commercial vehicles) and higher discounts leading to a 7.9% qoq decline in net average realization. On a sequential basis, consolidated EBITDA margins stood flat at 12.3% (lower than our estimates of 12.8%) which led to  a 6.1% growth in operating profit to `5,657cr. The EBITDA margins at JLR declined 80bp sequentially led by inferior product-mix and higher marketing costs related to the launch of the new  Range Rover. On the standalone front, EBITDA margins contracted sharply by 387bp qoq to 1.4% due to adverse volume-mix, lower utilization levels and higher discounts and marketing spends in the passenger vehicle and medium and heavy commercial vehicle business. However, adjusted net profit declined 13.6% qoq (49.5% yoy) to `1,801cr, lower than our expectations of `2,865cr, on account of higher depreciation expense (up 29.8% qoq), forex loss of `174cr and higher tax rate (at 38.7% as against 32% in 2QFY2013). Source: Angel Broking

GAIL - RU3QFY2013

GAIL’s 3QFY2013 result was above our expectations. The company’s top line grew by 10.8% yoy to  `12,474cr (above our estimate of  `11,986cr) mainly due to higher than expected performance from  Petrochemicals and Natural gas trading segment which grew by 26.1% and 10.6% yoy to  `1107cr and  `10118cr respectively. The company’s fuel subsidy burden stood at  `700cr in 3QFY2013, compared to `536cr in 3QFY2012 and `786cr in 2QFY2013. The petrochemical and LPG segment EBIT grew by 13.4% and 93.8% yoy to  `439cr and  `592cr, respectively. However, natural gas trading and LPG transmission EBIT decreased 7.5% and 82.9% yoy to `299cr and `13cr, respectively. However GAIL’s EBITDA improved by 16.4% yoy to `2,049cr in 3QFY2013 and EBITDA margin improved by 79bp yoy to 16.4% and therefore the company’s net profit increased by 17.6% yoy to `1,284cr (above our estimate of `1,147cr). Source: Angel Broking

DLF - RU3QFY2013

For 3QFY2013, DLF reported disappointing set of numbers both on revenue and profitability front. On the top-line front, DLF’s revenue decline by 35.8% yoy to `1,310cr in 3QFY2013; which was below consensus estimate of  `2,040cr. EBIDTAM came in at 6.6% in 3QFY2013 which was significantly below street estimate of 36.6%. However, owing to surge in other income mainly due to asset sale company reported a PAT of  `285cr for the quarter, indicating a growth of 20.2% yoy. We will come out with a detailed note a conference call with the management. Source: Angel Broking

DRL - RU3QFY2013

DRL came out with results higher than expectations. The company, is expected to post a 23% yoy growth (adjusted for the base effect) to end the period at `2,870cr, while the net profit came in Rs364cr, which dipped 39.1% yoy. The sales growth (adjusted) came in back of global generics of 24% yoy, primarily driven by North America and Emerging markets. Both the net sales and profit came in higher than expectations. The OPM came in lower than expected at 19.9% (V/s 20.7% expected). Source: Angel Broking

LIC Housing - RU3QFY2013

LIC Housing Finance reported disappointing set of numbers for 3QFY2013, as growth in its net interest income, came below expectations at 11.3% yoy. Operating profit growth came in moderate at 8.0% yoy. Provisioning expenses for the bank jumped up to  `32cr during the quarter, which was much higher than ours as well as consensus estimates and hence earnings declined by 22.7% yoy. At CMP,  it  trades  at  valuations  of  1.8x  FY  2014E  ABV.  We  await  clarity  from  the management about the quarterly performance and the future outlook. Source: Angel Broking

HDIL - RU3QFY2013

For 3QFY2013, Housing Development & Infrastructure ltd (HDIL) reported mixed set of numbers with revenue coming in above street expectations but owing to lower-than-expected EBITDAM, earnings were below consensus estimates. On the top-line front, HDIL reported revenue of `423cr in 3QFY2013 indicating a decline of 0.6% yoy but was ahead of street estimate of  `325cr. EBITDAM improved by 1111bp yoy to 49.1% for the quarter, and was below consensus estimate of 74.1%. Interest cost came at  `23cr, indicating a growth of 21% yoy. The company’s PAT declined by 31.1% yoy to  `107cr (against consensus estimate of `154cr) in 3QFY2013. Source: Angel Broking

Bank of Baroda RU3QFY2013

For 3QFY2013, Bank of Baroda reported subdued operating performance, as its operating income and operating profit declined by 3.2% and 13.5% yoy, respectively. Provisioning expenses for the bank increased by 22.6% yoy, on account of higher slippages during the quarter and hence earnings at PBT level declined by 30.9% yoy. The bank witnessed lower effective tax rate of 16.7% during the quarter compared to 26.6% in 3QFY2012, which limited the decline in net profit to 21.6% yoy. On the asset quality front, the bank witnessed sequentially deterioration, gross and Net NPA levels increased by 24.5% and 41.0% qoq, respectively, on an absolute basis. The management has guided for asset quality pressures to continue for next few quarters. Gross and Net NPA ratio came higher sequentially by 43bp and 30bp, respectively to 2.4% and 1.1%. The bank’s PCR dipped sequentially by 484bp to 70.9%. At the CMP, the stock is trading at valuations of 0.9x FY2014E ABV. Source: Angel Broking

United Spirits RU3QFY2013

United Spirits (USL) posted a 11.3% yoy growth in top-line to  `2,174cr. Overall volumes for the quarter rose by 7% yoy and stood at 32.58 million cases. The volume growth in the prestige and above segments stood at 29% yoy, indicating the company’s focus towards the premium segment. OPM for the quarter stood at 11.3% up 185bp on yoy basis. Bottom-line rose by 71.2% yoy to  `81cr. Source: Angel Broking

ITNL RU3QFY2013

For 3QFY2013, on a consolidated basis,  IL&FS Transportation Networks (ITNL) posted a strong performance at the top-line and EBITDAM fronts. However, higher interest cost and higher tax provision led to a subdued growth at the bottom-line level. The company reported consolidated revenue of  `1,764cr (`1,268cr) in 3QFY2013, registering a growth of 39.1% yoy, which was 12% higher than our estimate.  EBITDA margins declined sequentially by 754bp to 25.5% vs 25.3% in 3QFY2012, and against our estimate of 28%. This was mainly on account of higher revenue contribution from the relatively low-margin E&C segment during the quarter. ITNL’s interest cost grew by 53.3% yoy to `284cr in 3QFY2013 and was marginally above our estimate of  `280cr. On the earnings front, ITNL reported subdued growth of 18.5% yoy to `104cr (our estimate was of `108cr) on back of higher interest cost and tax (40%).Source: Angel Broking

Relaxo Footwear RU3QFY2013

Relaxo reported lower-than-expected numbers for 3QFY2013. The revenue for the quarter grew by 9.2% yoy and stood at  `223cr, lower than our expectation of `250cr. Operating margin for the quarter was flat yoy at 8.4%, however, it was lower than our expectation of 10.3%. Additionally, the operating margin contracted by 148bp on a qoq basis from 9.9% in 3QFY2013 on account of higher employee cost and other expenses (mainly advertisement expense) as a percentage of net sales. Subsequently, the profit for the quarter stood flat yoy at `6cr, which was 49.9% lower than our estimate of `15cr. However, we remain positive on the company with the growth triggers in place, which include – 1) capacity expansion plan, 2) store expansion, 3) improved sales mix and 4) brand revamping. At  `755, the stock is trading at 13.6x FY2014E earnings. Source: Angel Broking

United Phosphorus-RU3QFY2013

For 3QFY2013, United Phosphorus (UPL)’ revenue grew by 20.5% yoy to `2,255cr and net PAT grew by 53.1% to  `173cr. The Management has maintained its positive revenue growth guidance of 15% and OPM (incl. other income) growth guidance of 19-20% for FY2013. For FY2014, also the company expects to post a high double digit growth. Even after factoring in  conservative numbers, the stock is quoting at an attractive valuation of 8.0x FY2014E EPS. We expect UPL to post a CAGR of 10.0% and 18.4% in its sales and PAT over FY2012-14, respectively. At current valuations of 8.0x FY2014E EPS the stock is attractively valued.Source: Angel Broking

KPIT Cummins-RU3QFY2013

For 3QFY2013, KPIT Cummins Infosystems (KPIT) reported in-line revenue numbers but operational performance of the company disappointed. Growth was sluggish due to lower billing days and shut downs of 2-3 days across the organization. For FY2013, the Management has maintained its USD revenue growth guidance of 32-35% yoy, which is 2.5x more than Nasscom’s guidance of 11-14% growth and includes ~US$45mn inorganic revenue from Systime.KPIT’s Management has maintained its FY2013 USD revenue growth guidance of a whopping 32-35% yoy (US$408mn-418mn), which is the strongest amongst its peers. On the PAT front, the company has revised its guidance upwards to 35-38% yoy growth to  `196-200cr. The company is growing ahead of other IT companies in terms of revenue; and on the operational front, the company’s performance has been improving since the last three quarters. KPIT has reiterated its positive tone and does not witness any delay in decision making. Hence, we expect the company’s revenue to post a CAGR of 21.8% and 28.5% in USD and INR terms, respectively, over FY2012-14E. On the EBITDA and PAT fronts, the company is expected to post a 31.6% and 32.0% CAGR over FY2012-14E. The stock is currently trading at 9.0x FY2014E EPS of `12.8. We value the company at 11x FY2014E EPS, which gives us a target price of `140.Source: Angel Broking

Sterlite Industries-RU3QFY2013

Sterlite Industries (Sterlite) reported  disappointing 3QFY2013 results. Both, the top-line as well as the net profit were lower than expected, mainly due to lower-than-expected performance from the Copper segment. We expect Sterlite to benefit from the expansion of Zinc-Lead smelting capacity during FY2013-14 although its Aluminium segment’s profitability is expected to remain under pressure. Considering the ongoing process

of group restructuring by the promoter, Vedanta Resources, the valuation of Sterlite will mirror the valuation of the consolidated company - Sesa Sterlite. On account of ban on mining in Goa, we had drastically cut Sesa Goa’s iron ore volume estimates for FY2014. Source: Angel Broking

Coal India - RU3QFY2013

Coal India (CIL) results came in above our estimate on account of higher than expected sales volumes. Net sales grew by 12.9% yoy to `17,325cr. Sales volumes grew by 9.2% yoy to 120mn tonnes (our estimate of 112mn tonnes) indicating company’s focus on increasing offtake. Railway rakes availability stood at 214/day (CIL’s requirements currently stand at 234/day). Realizations grew by 3.4% yoy although flat qoq to  `1,439/tonne. However, EBITDA decreased by 7.8% yoy to `5,195cr due to higher staff costs. Other income grew by 27.2% yoy to `2,361. Consequently, net profit grew by 8.7% yoy to  `4,395cr above our estimate of `3,808cr. Source: Angel Broking

NMDC - RU3QFY2013

NMDC’s 3QFY2013 results were weaker-than-expected due to lower-than expected sales volumes as well as realizations. NMDC’s net sales fell by 27.5% yoy to `2,047cr (below our estimates of `2,162cr) mainly due to lower volumes which declined 16.9% yoy to 5.32mn tonnes. Iron ore realizations also declined 13.1% yoy to  `3,820/tonne.  EBITDA declined by 38.5% yoy to `1,390cr and EBITDA margin contracted 1,218bp yoy to 67.9%. Other income grew by 5.9% yoy to `556cr mainly due to higher cash balance. Consequently, net profit decreased by 30.5% yoy to `1,292cr (below our estimate of `1,518cr).  The company had 5mn tonne of inventory as on December 31, 2013. It also reported that it had a record production of 3mn tonne for January 2013. Source: Angel Broking

TATA Steel - RU3QFY2013

Tata Steel reported disappointing set of results for 3QFY2013 mainly due to weaker-than-expected profitability performance from both its European and Indian operations. Its consolidated net sales declined by 3.0% yoy to 32,107cr (below of our estimate of `38,228cr). Consolidated steel sales volumes increased 3.6% yoy to 5.83mn tonnes. Its India operations net sales grew by 12.8% yoy to `9,370cr due to higher sales volumes (+16.6%  yoy to 1.89mn tonnes). However, India operations EBITDA decreased 1.1% yoy to `2,526cr mainly due to higher power and fuel cost and freight costs during the quarter. India operations EBITDA/tonne decreased 15.2% yoy to `13,366. On the international front, Tata Steel Europe’s (TSE) volumes declined by 9.9% yoy to 3.02mn tonne. TSE reported an EBITDA/tonne for US$(26) compared to a US$(44) in 3QFY2012 mainly due to lower realizations. The company reported a consolidated adjusted net loss of `743cr vs. our estimate of a net profit of `683cr. Consolidated net debt increased to  `57,981cr as on December 31, 2012, compared to  `47,657cr as on March 31, 2012. In light of lower-than-expected profitability for 3QFY2013, we are likely to lower our profitability estimates for FY2013. Source: Angel Broking

JSW Steel - RU3QFY2013

JSW Steel reported consolidated 3QFY2013 results. Earlier, it had reported standalone results which were broadly in line with our expectations. JSW Steel’s consolidated 3QFY2013 top line grew by 5.5% yoy to `8,887cr. The company’s EBITDA was flat yoy at `1,330cr however, EBITDA margin increased by 104bp yoy to 15.0%. The company reported exceptional item related to forex loss of `268cr during the quarter.  Interest expenses grew by 36.4% yoy to `517cr and other income declined by 63.7% yoy to `8cr. The company reported a share of loss from associate of `73cr and hence, adjusted net profit (excluding exceptional items) decreased by 61.2% yoy to `214cr. However the company reported a net loss of `74cr vs. a net loss of `48cr. Source: Angel Broking

Madras Cements - RU3QFY2013

Madras Cements posted a 17.7% yoy growth in top-line to `872cr, which was inline with estimates. We expect the top-line growth to be on account of a reasonably strong growth on the volumes front. OPM stood at 26.9% down by 107bp on yoy basis. Bottomline rose by 9.3% yoy to `84cr. Source: Angel Broking

Dabur India - RU3QFY2013

For 3QFY2013, Dabur India (Dabur) posted a 12.3% yoy growth in its consolidated top-line, which was in-line with our estimates. The company’s net profit rose by 22.2% yoy to `211cr aided by strong perational performance. The domestic consumer business posted a 14.3% yoy growth with volume growth coming in at 9.5%. While the Management maintained that rural markets and modern trade performed well, lower procurement by CSD impacted sales. In terms of category, Foods grew by 22.1% yoy while Home & Personal care grew by 15.7% yoy. The Hair care portfolio grew by 13.9%, while Shampoos grew by 29.6% yoy. The company’s international business posted a growth of 9%, with the organic international business posting a growth of 22.4% yoy. The OPM stood at 16.5%, up 126bp yoy, led by a healthy expansion in gross margins in the international business due to reduction in commodity costs.  The company’s advertising and promotion expenditure as a percentage of sales rose by 77bp yoy to 14.4%. Finance costs fell by 57.5% yoy to `7.8cr, due to favorable forex impact on a yoy basis. We expect Dabur’s top-line to post an ~16.1% CAGR over FY2012–14E. The bottom-line is expected to post a 21.6% CAGR, aided by top-line growth and margin expansion.Source: Angel Broking

Idea Cellular - RU3QFY2013

For 3QFY2013, Idea Cellular (Idea) reported mixed results with revenue coming in in-line with expectations while operating margin surprised negatively. The company’s total network minutes grew by 5.2% qoq, leading to a growth in network traffic to 132bn min. The average revenue per minute (ARPM) declined by 0.5% qoq to `0.41 due to decline in non-voice revenues’ share to 14.6% from 15.6% in 2QFY2013. The Management indicated that the company has not hiked headline tariff (as of now), but has only reduced promotional offers, that too in specific circles.During 3QFY2013, Idea won back 1,800MHz spectrum in all its seven circles in the 2G auction conducted by the government in November 2012, for which licenses had been quashed by the Supreme Court. Post the 2G auction, only four operators have pan-India presence. Idea’s Management indicated that the company has not hiked headline tariff (as of now) and has only reduced promotional offers, that too in specific circles. However, it reiterated its stance that tariff hikes are becoming imminent. Going forward, we expect ARPMs to improve as Idea has hiked tariffs via reduction of promotional offers. This should offset the rising input and regulatory costs. With increase in tariff rates expected going ahead, we have factored in a revenue CAGR of 10.7% over FY2012-14E. Idea still remains surrounded by regulatory uncertainties in the sector such as one-time spectrum fee  and spectrum refarming. With the 2G auctions coming up in March 2013, we expect partial resolution of these uncertainties, and the same would be a positive for the sector as a whole.Source: Angel Broking

Ipca Labs - RU3QFY2013

For 3QFY2013, Ipca Laboratories (Ipca) reported a good set of numbers, although they are a lad lower than our expectations. The top-line grew by 15.1% yoy to `692cr, lower than our expectation of `740cr. The OPM came in line with our expectation at 21.6% vs 16.4% in 3QFY2012. However, the same was not reflected in the net profit growth on account of a high rise in interest expenses. The net profit rose 36.3% yoy to `88cr vs our expectation of `107cr. We expect net sales to post a 21.4% CAGR to `3,474cr and EPS to register a 30.6% CAGR to `37.3 over FY2012–14E, driven by the US and domestic markets and the API segment. At current levels, the stock is trading at 16.3x and 13.1x FY2013E and FY2014E earnings, respectively. Source: Angel Broking

SAIL – RU3QFY2013

SAIL’s reported disappointing 3QFY2013 results as both net sales and net profit were below our estimates due to lower than expected sales volumes. SAIL’s 3QFY2013 net sales declined by 0.9% yoy to `10,495cr (below our estimates of `11,730cr) mainly due to lower realizations partially offset by higher volumes. The company’s realizations stood at `35,168/tonne, compared to `37,326/tonne in 3QFY2012. Staff costs and other expenditure increased 11.6% and 23.5% yoy to `2,081 and `1,865cr, respectively. EBITDA therefore decreased by 28.0% yoy to`1,138cr and EBITDA margin contracted by 408bp yoy to 10.8%. The company reported an exceptional item related to forex loss of  `31cr in 3QFY2013, compared to exceptional loss of `466cr in 3QFY2012. Hence, reported net profit decreased by 23.4% yoy to  `484cr. However, excluding exceptional items, adjusted net profit declined by 53.1% yoy to  `515cr (significantly below our estimate of `716cr) in 3QFY2013.  We expect SAIL’s operational and financial performance to be impacted by 1) inability to maintain/raise sales volumes amidst slower demand growth; 2) higher employee costs, and 3) delays/cost overruns in its brownfield expansion projects. SAIL is on the verge of expanding its saleable steel production capacity from 12.5mn tonnes to 24.0mn tonnes by FY2015. However, the current rich valuation discounts its anticipated volume growth over FY2012-FY2016E.Source: Angel Broking

HTMedia – RU3QFY2013

For 3QFY2013, HTMedia’s top-line and bottom-line performance was better than our expectations. The company’s top-line grew by 4.4% yoy to  `547cr (v/s our expectation of `535cr). Advertising revenue grew by 2% yoy to `415cr, primarily driven by volume growth. The circulation revenue grew by 12.3% yoy to `56.5cr driven by combination of higher circulation and higher realization per copy.  The OPM expanded by 109bp yoy to 16% aided by 134bp yoy decline in consumption of raw materials. Consequently, profit grew by healthy 11.4% yoy to `56cr. At the current market price, HTMedia is trading at 12.5x FY2014E consolidated EPS of `8.3. Source: Angel Broking

Motherson Sumi Systems – RU3QFY2013

Motherson Sumi Systems (MSS) registered a better-than-expected operating performance for 3QFY2013 driven by strong growth in the standalone operations and at the Samvardhana Motherson Reflectec (SMR) front. For 3QFY2013, consolidated revenues registered a strong sequential growth of 13.1% to `6,663cr which was better than our expectations of `6,168cr. The top-line growth was led by a strong performance at the standalone level (up 10.5%) and also on the SMR (up 16.4%) and Samvardhana Motherson Peguform (SMP, up 12.8%) front. On a yoy basis, top-line grew by 73.5% largely on account of consolidation of SMP operations which contributed `3,332cr to the top-line. SMR revenues were driven by pick-up in order execution at the new plants in Hungary, Brazil and Thailand. While the revenues in India grew by a healthy 9.7% qoq (27.8% yoy); revenues outside India grew strongly by 13.6% qoq (87.4% yoy). On the operating front, consolidated margins improved ~70bp sequentially (~100bp yoy) to 7.6% led by significant improvement in performance in standalone operations (margins improved 380bp qoq to 18.9%) and at the the SMR (margin improvement of 200bp to 7%) front. This was primarily on account of increasing capacity utilization levels across the key plants. The operating performance at the SMP level too remained stable during the quarter. Led by strong operating performance, consolidated EBITDA jumped 24.3% qoq (99% yoy) to `509cr. Nevertheless, the bottom-line declined 25.1% qoq to `103cr as MSS witnessed a forex loss of  `64cr related to the foreign currency loans. The depreciation expense too increased 17.5% qoq which had a negative impact on the profitability. While the bottom-line at SMR grew robustly to `15cr (against `6cr in 2QFY2013); SMP reported a net loss of  `34cr as against  `8cr profit in 2QFY2013 owing to the forex loss of `52cr. Source: Angel Broking

Nestle - RU3QFY2013

For 4QCY2012 Nestle posted a 10.1% yoy growth in top-line to  `2,153cr. Domestic sales increased by 9.6% yoy to `2,041cr on account of better realizations and superior product mix. Exports rose by 20.6% yoy aided by higher exports to third parties, which rose by 47.2% on a yoy basis. OPM stood at 22.3%, up 122bp on a yoy basis. Bottom-line rose by 20.8% yoy to `279cr. Source: Angel Broking

Abbott India - RU3QFY2013

For 4QCY2012, Abbott India (AIL) reported a better than expected performance. Its top-line grew by 12.3% yoy from  `399cr in 4QCY2011 to  `448cr in 4QCY2012, 5.6% higher than our estimate of `424cr. For the full year CY2012, AIL witnessed a 14.3% yoy revenue growth to `1,653cr. EBITDA margin expanded by 241bp yoy to 16.3% in 4QFY2012 from 13.8% in 4QCY2011 due to decrease in employee cost and other expenses during the quarter. This led to a net profit growth of 35% yoy to `50cr in 4QCY2012 from `37cr in 4QCY2011. Fall in other expenses during CY2012 led to EBITDA margin expansion during CY2012 by 226bp to 12.2% from 10% in CY2011, thus leading to a 20% yoy growth in net profit for CY2012 to `145cr.  Source: Angel Broking

Dr. Reddy's Laboratories - RU3QFY2013

Dr. Reddy’s Laboratories (DRL) reported more or less just-in 3QFY2013 top-line and bottom-line performance. The company’s net sales increased by 3.5% yoy    (23%  adjusted  for  the  base  effect).  The  growth  came  in  on  back  of  24%  yoy (adjusted) in the US and Emerging Markets. On the EBIT margins came in at 15.0% V/s expected 15.8%. Consequently the net profit came in at `363cr, a dip of 29.1%, mostly in line with expectations of `339cr. DRL reported net sales of `2,865cr for 3QFY2013, registering 23.0% yoy growth, which was a tad lower than our estimate of `2,700cr. The U.S. and Emerging markets grew by 24% yoy (adjusted) were the key growth drivers for the company. The domestic market reported a strong growth of 12.0% yoy. On the positive side the PSAI segment posted a robust growth of 28.0% yoy during the quarter. The company’s EBIT margin came in at 15.0% V/s expected 15.8% and contracting by 11.7%, leading to a dip of 29.1% to `363cr during the quarter. DRL has reinforced its earlier revenue guidance of US$2.7bn by FY2013E with RoCE of 25%. We expect net sales to report a 9.8% CAGR to  `11,662cr and adjusted EPS to record a 2.3% CAGR to  `92.9 over FY2012-14E. Source: AngelBroking

GSK Consumer - RU4QCY2012

For 4QCY2012 GlaxoSmithkline Consumer Healthcare (GSK Consumer) posted a 17.9% yoy growth in net profit to `70cr, aided by a 161bp yoy improvement in gross margin and a 46.6% yoy increase in auxiliary income. For 4QCY2012 GSK Consumer posted a 17.8% yoy growth in net sales, aided by an  8% volume growth. The top-line growth was reasonably strong despite lower offtake by the canteen stores department (CSD). The company’s sales volume has been impacted by low CSD offtake since the beginning of CY2012. Better pricing resulted in a 161bp yoy increase in gross margin, despite the increase in cost of raw materials such as wheat, sugar etc. However, OPM was down by 305bp yoy to 7.2%, due to the steep 37.1% yoy increase in other expenses to `206cr. On a positive note, the company posted a 46.6% yoy increase in auxiliary income to  `25cr. The effective tax rate too was down by 658bp yoy resulting in a 17.9% yoy increase in net profit to `70cr. We expect the company’s malted food drinks (MFD) division to continue to post double digit growth, aided by the company’s efforts to strengthen its distribution network. The stock has run up steeply post the open offer announcement by the promoters. At  the current market price, the stock is trading at 31.2x CY2013E EPS of `123. Source: AngelBroking

ABB - RU3QFY2013

For 4QCY2012, ABB India’s (ABB) top-line and bottom-line performance was below our expectations. Top-line declined by 5.3% yoy to  `2,082cr, mainly on account of an 18% yoy decline in revenues from the power system segment to `599cr. ABB's operating margins continue to remain under pressure, coming in at 3.2%, due to lower margins in power systems and the process automation segment. Cost over-runs due to project delays and delay in payment of receipts have resulted in margin erosion. Consequently, ABB's bottom-line sharply declined yoy to  `17cr (against  `64cr in 4QCY2011). Source: Angel Brokimg

Gujarat Gas - RU3QFY2013

Gujarat Gas reported its 4QCY2012 results. The company’s top line increased 17.9% yoy to `756cr mainly on account of higher realization partially offset by lower volumes. Natural gas volume sold declined by 14.4% yoy to 270mmscm during the quarter. The decline was mainly in the industrial PNG segment. The company’s cost of goods sold increased by only 5.7% yoy to `603cr. Hence, EBITDA grew by 385.7% yoy to `108cr aided by lower other expenses and muted staff costs. Other income declined by 47.0% yoy to `10cr. Consequently company’s net profit grew by 187.5% yoy to `69cr. The company stated that it has received the sanction of the PNGRB to lay city gas distribution pipelines in Surat, Bharuch and Ankleshwar.  Source: Angel Brokimg

GSK Pharmaceuticals - RU3QFY2013

For 4QCY2012, Glaxo Pharmaceuticals’ results were ahead of our expectations on the net profit front, while the sales were just in line with expectations. Overall, net sales came in at `657cr, tad below the expectation of `680cr, and registering a yoy growth of 16.1%. The top-line growth was driven by a 15.9% yoy growth in the pharmaceuticals segment. On the operating front, gross margin came in at 57.3%, ie a contraction of 170bp, which along with a 32.2% yoy growth in the other income led the OPM to contract by 300bps to 27.2%. The OPM however, was higher than our expectation of 26.8%. Apart from this the higher than expected other income aided the adjusted net profit to come higher than expectation at `158.5cr, registering a yoy growth of 15.9% yoy. Source: Angel Broking