Dalal Street

GMR reported 2Q FY08 results, with revenue up 26%, to INR3.95bn against estimate of INR4.2bn. The revenue growth has been predominately due to the additional contribution from the airport business (INR753mn) and higher PLF of the two power plants (INR223mn). However, the net profit has been down 7.5% yoy, to INR495mn , due to INR343mn loss of Vemagiri power project (VPGL). VPGL has been non-operational since September 2006, due to the non-availability of gas and this will remain a drag on profitability for the full year.

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United Spirits Ltd – USL, despite its dominance and 5x the size of the next competitor, operates at EBITDA margin of merely 14% (in FY08E), far lower than market leaders in other parts of the world. Whyte & Mackay bulk scotch supplier, is benefiting from the up-cycle in scotch prices. We estimate W&M accounts for 1/3rd of Group EBITDA. Expect EPS CAGR of 60% over FY07-09E. USL trades at P/E of 28x FY09E. Expect USL to report an EPS of Rs 32.35 and Rs 62.35 for FY08 and FY09 respectively.
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Suzlon’s EBITDA margin rose to its long term guidance of 16% (7.2% in 1QFY08) led by a 76%YoY growth in volumes led by resolving of law & order issues in the domestic market, improved deliveries in the international market and sell-down of inventory (140MW of the total 683MW). On the back of record deliveries of 683MW and resultant operating leverage, led to 68% YoY growth in PAT at Rs3.9bn, much ahead of the Street estimate of Rs2.5bn. The company also has a strong order book position. (more…)