Indian Equity Research and Investment Strategy
Breaking News in Corporate India / Earnings Analysis
India is the world’s largest milk producer, at 112mn tonnes currently. However, drought conditions, tighter feed and water availability have resulted in only a moderate growth in output; while demand has continued to rise due to shifting food patterns.
The key drivers of the upturn in India’s inflation so far have been primary articles (cereals, pulses) and manufactured food products (sugar, edible oil cakes). While we have highlighted the risk of higher (more…)
The Kirit Parekh report suggests the government to deregulate gasoline and diesel prices, increase kerosene price by Rs6/lit and raise it every year, and increase LPG prices by Rs100/cylinder and revise upward periodically. These suggestions are largely in line with the recommendations of earlier committees. We believe the suggestions are likely too aggressive to be implemented in current form, given inflation concerns, implementation issues and political considerations. (more…)
Tata Chemicals revenue down 25%yoy given lower realization on gas based urea and PAT up 83% led by – consolidation of Rallis India, strong volume growth in urea and off lower base of Q3FY09 PAT that was hit by one offs.
Soda ash sales in international operations improved 5%qoq but at lower prices. We expect muted performance in soda ash to continue due to ANSAC’s strategy of cutting prices to regain market share from Chinese producers will result in stable to lower prices ahead and ~20% (more…)
Titan’s business has turned around during Q3FY10, but the sheer velocity of the rebound has come as a major positive surprise. The company reported an exceptional performance on all counts – revenues grew by 30% YoY to Rs 13.3bn, the EBITDA margin expanded by 225bps, while adjusted net profit doubled to Rs 754mn.
Strong growth was seen in both its jewellery and watch businesses, Titan reported a 30.2% YoY rise in revenues to Rs 13.3bn, as against our estimate of Rs 11.5bn for the quarter. (more…)
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Reliance Infra (RELI) had weak 3Q10 with Rec. PAT Rs2.7bn -30%YoY on non recognition of Rs580mn of profit on electricity sale of Rs700mn (delayed tariff hike in Mumbai License area – MLA), weak execution in EPC (sales -7%YoY), higher depreciation (+41%YoY) and lower treasury income (-27%YoY). However, Rec. PAT would be -15%YoY if profit of Rs580mn has been considered. Reported PAT +10%YoY due to loss of Rs1.4bn on derivative instruments last year. E&C order backlog was Rs190bn – 5.9x FY10E sales. (more…)