Riddhi Siddhi [RSGB’s] 500 TPD maize-crushing plant at Uttarakhand has successfully completed trial runs and has commenced commercial production. The Uttarakhand plant is state-of-the-art and has been built with inputs from Roquette Ferres, which is one of the global leaders in maize starch and its value added derivatives. It was built at a cost of Rs.1.2 bn.The plant would be able to provide timely and effective service to its large number of corporate and institutional clients who have set up facilities in Uttarakhand and Himachal Pradesh. (more…)
Year: 2008
Bharat Forge – Weak Castings
Recurring parent PAT at Rs 683m (+6% Y/Y), was in-line with estimates. EBITDA margin rose 70 bps y/y (50 bps above estimates) led by stronger growth in exports, and (we reckon) the attendant beneficial DEPB impact. However, slower growth in domestic demand, margin pressures due to rise in input costs, a volatile currency, and slower-than-expected turnaround in operations of subsidiaries and JV operations are a dent on its bottom line.
Although subsidiary operations are expected to improve over the next two years, parent PAT is forecast to account for c80-85% of consolidated PAT over the next 2 years – and parent operations are thus the key to long-term growth and profitability. We forecast strong earnings CAGR of 26% in standalone PAT over the next two years, driven by steady improvement in export sales (notably in non auto segment).
Bharat Forge’s EPS for FY09 is expected to be mere Rs 14.3 while that of FY10 is expected to hit Rs 20.25.
SAIL Showing Strength – ICICI
ICICI Sec has recommended a BUY on SAIL [Steel Authority of India Ltd]. SAIL’s Results were above expectations even though the company is out of the Iron & Steel Cartel prevailing in India.
Average realisations at ~Rs37,200 in Q4FY08 were higher 15% YoY & 17% QoQ. While SAIL will maintain prices for the next 2-3 months (as committed to the Government), the average realisation for Q1FY09 would be higher since the price increase was taken largely during February and March. (more…)
Shipping Corporation 1:2 Bonus
The board of Shipping Corporation of India has considered the proposal to issue 1 bonus share for every 2 shares held, to the shareholders and it was decided to recommend the proposal to the administrative ministry i.e. ministry of shipping, road transport & highways for their approval in terms of the articles of association of the company.
Sell Tech Mahindra – Citi
Citi in a report released just a while ago has recommended a SELL / High Risk on Tech Mahindra.
Tech Mahindra (TM) posted revenue of US$258m (vs. estimate of US$260m) and a margin decline of ~20bps, despite sharp uptick in utilization (400bps) and no pass-through revenue in 4Q. Net profit of Rs2.2bn was below expectations (est. Rs2.27bn) despite forex gains of US$7m. (more…)
SAIL Exhibits Strength
Steel Authority of India (SAIL) reported robust numbers for the quarter ended March 2008. Revenues for the quarter rose 32.8% YoY to Rs 137.9bn on the back of sharply higher realizations, with record saleable steel production of 3.5mn tons and improved product mix. However, bottom-line growth lagged that of the top line mainly due to higher employee costs (additional provision of Rs 15.9bn), which rose 100% YoY due to wage revision of employees, w.e.f 1 Jan 2007.
EBITDA margins declined by 260bps YoY, primarily due to higher employee costs. Profits rose 25% YoY to Rs 23.7bn. For FY08, the company reported an 18.2% growth in revenues (including price escalation) and an EBITDA of Rs 122bn, up 24% YoY. Operating margins for the year stood at 29.7% vs. 28.3%.