Year: 2008

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.

Earlier 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.

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%]

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.