This housing finance company has risen by 1.8% in the past week, following the Finance Minister’s announcement to build two crore homes under the PM Awas Yojana and introduce a scheme for middle-class home buyers. In Q3FY24, the firm’s net profit increased by 32% YoY to Rs 2,001 crore due to a 236 bps YoY decrease in operating margin to 14.7%. The transition to centralized disbursement in October 2023, prompted by fraud detection at its Ambala Branch in Haryana, led to a 23% YoY fall in Q3 disbursements to Rs 1,879 crore and moderate AUM growth of 13% YoY to Rs 34,053 crore.
The outlook for FY25 is positivefor housing financiers due to potential rate cuts and strong GDP growth. The management aims to double the loan book size (currently Rs 34,000 crore) over the next four years, expecting monthly disbursements to shoot up to Rs 1,000 crore by Q4FY25 from Rs 700 crore currently.
The firm’s Net Interest Income (NII) grew by 30.6% YoY to Rs 329 crore, and its Net Interest Margin (NIM) expanded 30bps YoY to 3.9% in Q3. The gross NPA ratio worsened by 31bps YoY to 0.91% in Q3 due to one-time loan restructuring of around Rs 90 crore. However, asset quality is expected to improve by FY24, thanks to the financier’s low-risk customer profile (72% salaried professionals and 26% self-employed).
Axis Securities foresees high margins in the near term, as they expect reduced loan refinancing rates from the National Housing Bank. A recent credit rating upgrade by ICRA is also expected to benefit the firm's cost of funds.
This refineries/petro-products stock has surged by 20.8% over the past week, touching its all-time high of Rs 635.3 per share on Thursday. This rise comes after the company posted a 82.1% YoY growth in net profit to Rs 3,181.4 crore for Q3FY24 on January 29. Despite a 2.5% YoY decrease in revenue to Rs 1.3 lakh crore, it beat Trendlyne’s Forecaster estimates by 14.3%. Its net profit also exceeded Forecaster estimates by 5.5%. The company shows up in a screener of Trendlyne’s high-return, technically strong value stocks.
The decline in revenue is on account of lower demand, despite a 5% YoY increase in crude oil production volume to 9.9 MMT during the quarter. Its EBITDA margin has expanded by 170 bps YoY to 5.1%, owing to lower raw materials and finance costs. Brent crude prices fell by 10.4% in 2023, helping margin expansion and boosting the company’s stock prices. The company has given a dividend yield of 5.5% over the past year.
The government has allotted Rs 15,000 crore to oil marketing companies in the FY25budget. The oil refiner and marketer has also planned a capex of Rs 1.5 lakh crore for the next five years. G Krishnakumar, the Chairman and Managing Director, said, “Of this Rs 1.5 lakh crore, we have earmarked Rs 75,000 crore for refineries and Petchem ventures, about Rs 32,000 crore in the upstream business (oil exploration and production), and Rs 25,000 crore each in gas and marketing infrastructures.”
Post-results, Yes Securities maintains its ‘Buy’ rating on the stock with a target price of Rs 620 per share. The brokerage is optimistic about BPCL's strategic debt reduction, its targeted capex and enhanced refining efficiency.
This retailing company has risen by 23% in the past three days, touching an all-time high of Rs 3,937.4 on Thursday following strong Q3 results. Trent’s net profit more than doubled by 152.3% YoY to Rs 374.4 crore, beating Trendlyne’s Forecaster estimates by 41.7%. As a result, it features in a screener of stocks with consistently increasing profits for the past three quarters.
Revenue grew by 50.5% YoY, led by store expansion and increased footfall. During the quarter, it opened five Westside stores and 50 Zudio stores, taking the total store count to 227 and 460 respectively.
The company’s Star business (which contributes around 19% to total revenue) reported a 26% YoY revenue increase, led by strong LFL (like-for-like) growth of 24% and volume growth. Noel N Tata, Chairman of the company, said, “Star business is attracting more customers, becoming an essential growth driver.”
Additionally, the share of Trent’s own brand in Star's sales increased from 57% in Q3FY23 to 69%, driving margin growth. Trent’s EBITDA margin expanded by 336 bps to 18.8% during the quarter.
After the company’s earnings announcement, Motilal Oswal reiterates its ‘Buy’ rating on Trent with an upgraded target price of Rs 4,200. The brokerage is optimistic about the company’s long-term growth prospects, driven by LFL growth, retail expansion, and scale-up within Zudio.
This pharma company hit its all-time high of Rs 1,457.7 on Thursday, with a 13.2% increase in the past month. This rise was driven by a 31.8% YoY growth in its Q3FY24 net profit to Rs 1,055.9 crore. Cipla’s revenue also increased by 14.6% YoY, aligning with Trendlyne Forecaster estimates. The company appears in a screener for stocks with improving RoCE over the past two years.
Cipla’s EBITDA margin improved by 225 bps to 26.5%, led by a better product mix, price hikes in the US, and easing of cost inflation. The North American market led this growth, reporting a 19.8% YoY increase in revenue on the back of high volume in Lanreotide, which holds a 20% market share in the US. The drug is used to treat patients with endocrine and gastric tumors. Lanreotide’s US sales, around $470 million, are projected to grow at a CAGR of 4.1% by 2032.
Despite price hikes by Indian manufacturers in the US, Indian drugs remain cheaper than their US counterparts, leading to higher purchases by US distributors. Also, drug shortages in segments like asthma, cancer and chronic diseases have seen higher price realisation. The company’s 9MFY24 EBITDA margin stands at 25.4%. Chief Financial Officer Ashish Adukia said, “FY24 EBITDA margin is expected to be higher than the earlier guidance of 23-24%.”
Going forward, the management plans to prioritize the Indian market, which accounts for 44% of its total revenue, by strengthening its portfolio offerings. Meanwhile, the North American vertical will focus on executing the existing portfolio. According to the management, “Research and development spending is largely directed toward the US market and could represent around 6% of revenue in the near to medium term.”
BoB Capital Markets retains its ‘Buy’ call on Cipla. It expects strong margins and a healthy profit CAGR of 20% over FY24-FY26 on the back of new launches in North America, a recovery in Africa and the API business, and ongoing momentum in the Indian market.
This non-alcoholic beverage firm rose by 3.4% on Tuesday after its Q4CY23 earnings announcement, where net profit surged by 76.5% YoY to Rs 132 crore on increased sales volumes. The company’s EBITDA margin also improved by 180 bps YoY due to lower raw material expenses. The company appears in a screener of stocks with improving return on equity over the past two years. According to Trendlyne’s Technicals, the stock has risen by 7.9% in the past month, outperforming the food and beverage sector, which fell 3%.
In Q4CY23, revenue increased by 21% YoY to Rs 2,670 crore, driven by an 18% YoY growth in volume and a 2% YoY hike in realization per case to Rs 171. The volume growth in soft drinks and juices was at 25% and 14% YoY, respectively. However, net debt increased by 38.7% YoY to Rs 4,730 crore by the end of Q4CY23.
The management anticipates robust growth in Gatorade (sports drink), juice, and value-added dairy segments, with plans to increase production capacity by 200%. The energy drink market in India, led by Sting, now accounts for 15% of the company's volume mix, well above the industry average of 6%. The India business saw a 13% YoY increase in sales volumes, thanks to an improved sales mix.
International markets, on the other hand, had a revenue growth of 16% YoY in Q4CY23, benefitting from better realization. The company plans to boost its capex by 71.4% to Rs 3,600 crore in 2024 and expand the number of outlets in India by 14.3% to 40 lakh by Q4CY24.
Motilal Oswal foresees a 23% CAGR in revenue, EBITDA, and PAT until 2025, driven by increased market penetration in India and Africa, higher product acceptance, ongoing capacity and distribution expansion, rural refrigeration growth, and scaling up of international operations. The brokerage maintains its ‘Buy’ rating on the stock.
Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.
