Reinforces our negative outlook on the Indian IT services sector In our recent report (read here), we had downgraded the Indian IT services sector, based on our expectation that most companies will report single-digit revenue growth over the next few years due to the challenges that they face from global behemoths (Accenture, Amazon, IBM) and niche start-ups in the digital space. The lacklustre 1QFY17 results by almost all...
pick up. We tweak our estimates to incorporate weakerthanestimated Q1 and higher depreciation. While the stock has seen positive interest from investors, since it is already tradingat23xourFY18EPS,wewouldwaitforinitialsignsofrecoverytoturnbullishonthe...
9 Production atthirdparty Baroda factory on a jobwork basis (in PEBS) increased from 800tonnepermonthinQ1FY17to~1100tonnepermonthinAugust.Itissettingup greenfieldprojectof30,000mtpaatGujaratwithcapexofRs250mnbyFY17end. 9 Order book of Rs 4.1bn and has orders worth Rs 6.5bn in pipeline. The company receivedmajorordersfromShapoorji&Pallonji;,JBFindustries,HIL,TewariWarehouse...
European business taking up the baton, the story has more scope. Improving European spreadsandongoingrestructuringinthatgeographywillbedriversofhigherprofitability. WhileIndianoperations'profitabilitywillstaysubduedintheneartermduetoseasonally...
8 EBITDA and margins were below estimates due to miss on revenue as operating expenditureswereinlinewithestimates 8 PATmissedestimatesduetomissonrevenue Key highlights: Ortel missed our revenue estimates due to lowerthanestimated infrastructure leasing revenue and lower digital cable ARPU. While some slowdown in infrastructure leasing revenue was expected, the extent of decline was disappointing. EBITDAmissmirroredthemissinrevenueestimates(asoperatingexpenditureswereinline) andwasflattishyoyvs.ourestimateof25%yoygrowth.However,netRGUadditionof69K...
in the last 13 quarters. Circulation revenue continues to be impacted by the entry of DB CorpintheBiharmarket.Newsprintpricesinchedupinthecurrentquarter(duetoincrease inenergycosts),whichresultedinamissongrossmargins.However,EBITDAwasaheadof estimatesduetolowerthanestimatedemployeeexpenditure.PATgrowthof17%yoywas...
Patanjali is a concept, quipped its public relations officer Mr Mishra when we visited Patanjali Ayurved Ltd's sprawling 170-acre plant (Unit 3) in Haridwar aptly named Padhartha (substance). The concept of Patanjali, based on the traditions of ayurveda, seemed ingrained in every person working there. While the company is still a work-inprogress, its direction and intentions are very clear. Patanjali is here to disrupt the FMCG market and it will do so in many categories. The Indian FMCG industry, so far dominated...
growth was +6% yoy (vs estimated 8%). EBITDA margin at 21.9% was 120bps below our estimates of 23.1%. The PAT (adjusted forforex gain ofRs448mn) declined 14% yoyto Rs 3.21bn(implying20%/17%misstoour/consensusestimates).InQ1FY17,CDHhasremoved JVsalesfromconsolidatedsalesandbookedtheshareofprofitfromJVsasperINDAS.Ifwe...
Key highlights: Revenue growth was largely driven by the UCP segment (65% of sales), whererevenuesgrew29%yoywhileMEPsegmentrevenues(31%ofsales)grewmodestly by 3% yoy. EBITDA grew 52% yoy to Rs 2bn and EBITDA margins expanded by 235bps to 10.8% (vs. our estimate of 9.3%). Margin expansion was evenly aided by gross margin expansion (100bps) and operating leverage. Segmentally, UCP segment drove the margin surprise(itsmarginsexpandedby263bpsyoyto14.9%,240bpshigherthanourestimate), whileMEPmarginswereat1.9%(up35bpsyoy,marginallybelowourestimateof2.5%). UCPmarginsbenefitedfromoperatingleverageonstrongvolumegrowth(29%yoy)inroom...
Topline was significantly below estimates as jewellery sales were impacted by a short wedding season and a sudden rise in gold prices; watches sales remained subdued EBITDA growth was higher than our/street estimates due to lower operating expenses Reported PAT was impacted by one-off expenses related to VRS; however, adjusted PAT growth was above our/consensus estimates Key highlights: Net sales rose 4% yoy to Rs 27.8bn vs. our/consensus growth estimates of 17%/15%. Gold prices rose 10% yoy. Jewellery grammage increased by 6% yoy and watches volumes grew 1% yoy. Studded share in jewellery fell sharply by 500bps yoy to 24% because...
