Category: Equity Research

TCS reported volume growth of ~5% and margin expansion of ~150bps qoq. Revenues at $1,538m (CIRA: $1,508m) and margins at 28.7% (CIRA: 27.2%) were significantly better. Net profit at Rs16.2b increased ~7% sequentially. BFSI, Retail and Utilities did well while Telecom, Manufacturing and Hi-tech seem to be bottoming out, according to the management. (more…)

Sarda Energy and Minerals Ltd. (SEML), promoted by Kamal Sarda, is a steel producer located in Chattisgarh with backward integration in iron ore mining, coal mining, pelletisation and captive power and a sizeable exposure to ferro alloys. The business model is on the cusp of a major structural change (more…)

Bajaj Auto reported PAT of Rs4 bn, slightly lower than estimate of Rs4.1 bn. The miss was bigger at the EBITDA level at Rs400 mn. The entire EBITDA miss was driven by 1.5% lower than expected realizations. A bigger proportion of 100cc bikes, especially in September, led by strong demand for Discover 100cc bike, seem to have led the slight underperformance. Export realizations were flat on a sequential basis while domestic realizations were down 2%.

Bajaj Auto reported EBITDA margins of 22.8% in the quarter, a 260 bps improvement sequentially and 880 bps improvement on a yoy basis. Volumes were up 25% sequentially. (more…)

HDFC Bank reported its quarterly results – The profit growth is a mix of steady margins (4.2%), a late quarter growth surge (10% QoQ), and robust fee income growth (+29%), backed by strong trading gains. Bottom line – earnings and the balance sheet, and their drivers/constituents, have recorded a strong quarter.

Asset deterioration has eased. Loan growth has been strong at quarter end (largely corporate, slack retail) and management sees more upside than downside risks. Here is what various well known brokerages who are active in the HDFC Bank Counter have to say about it. (more…)

Axis Bank reported Q2FY10 (September) net profit of INR5.3bn, up 32% y-o-y but 10% lower than street INR5.8bn estimate. Core revenue drivers continued to moderate on the back of sluggish corporate activity: Net interest income rose 26% y-o-y and fee income increased 15% y-o-y (versus 29% and 17% y-o-y, respectively. (more…)

SpiceJet highlighted how improving economic indicators has led to reversal in trends of domestic passenger traffic, and hoped momentum will sustain.

SpiceJet believes that recovery will favour low cost carriers (LCCs), which has already seen increase in share to ~30% share (up from 20% a year ago). Also, carriers such as SpiceJet have already returned to profitability due to relatively lower cost/ASKs, thanks to more seats/aircraft and lower distribution expenses. (more…)