Indian Equity Research and Investment Strategy
How to Get More Returns in Mutual Fund SIP with Swing Strategy ?
Max Life Insurance – Revised Deal, Positive for Max Financial
Will the Digital Neo Banking Platforms Succeed in India ?
Should you own the Life Insurance Business ?
Does HDFC AMC deserve High Valuation ? Review
Valuation of Indian Markets & Relentless FII Selling
Why Indian StockMarket Quoting at High P-E ?
Why Value Investing Does not Work in India ?
Edelweiss’ 4Q10 profits were better than estimates on higher investment banking fees and a sharp expansion in the wholesale financed asset book. For the full year (FY10), profits were however 18% below our estimates. Overall, the excess balance sheet and systemic liquidity remained a drag on returns (lower working capital and arbitrage yields). (more…)
ITC India’s leading Tobacco Giants reported PAT at Rs10.28bn. Despite steady cigarette profitability and lower losses in other FMCG segment, EBITDA margins contracted ~150bps YoY to 30.5%, reflecting lower margins of agri business (revenues surged to ~Rs10bn, Rs2.5bn ahead of expectations, but mix deteriorated). Paper profitability was a tad lower.
Volumes rose 8.5% YoY, driving 14% YoY revenue growth. Margins expanded ~30bps YoY. Weighted avg. price hikes of ~13-15% in the last 3 months would aid revenue growth. After a ~8% growth in volumes in FY10, we forecast 2%/4% volume growth in (more…)
India’s Largest Bank, SBI reported a PAT of Rs18.7bn down 32% y/y and significantly lower than our and street estimates of Rs26-28bn. Higher than expected NPA provisions and operating expenses led to the large miss. Though coverage did improve by ~400bps, it was proportionately lower than the P&L hit taken. For FY10 net profit was almost flat y/y at Rs91.6bn.
NPA – NPL’s do go up and so do restructured assets, but it is not dramatic, not concentrated and both the mix and management talk suggests asset quality will probably stay at these levels, rather than deteriorate. (more…)
In FY10, NTPC’s operating income grew 9% YoY to Rs482.2bn, EBITDA rose 14% YoY to Rs143.2bn, and reported PAT was up 6% to Rs87.3bn. However, adjusting for previous years sales (Rs6.01bn +), change in DTL (Rs4.57bn -), sales related to income tax recovery (Rs7.2bn +), tax related to earlier years (Rs5.25bn +), provision for pay hikes (Rs3.14bn -) and AAD (Rs3.16bn -), the recurring PAT Rs94.85bn is up 14% YoY. The results are in-line with our expectations on a reported basis. (more…)
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…)
