High input cost inflation, undertook price increase of 2.8% effective 1 St May We are increasing FY22/F23 EPS by 5.3%/7.6% and upgrade rating from Hold to Buy given that the structural growth drivers are getting better led by 1) Market share gains from both organized and unorganized players 2) strong innovation in Paints and coatings 3) growing usage of Putty and...
In BLSTR analyst meet, management highlighted its long term strategic vision which shall help funnel next leg of growth which include 1) mass market focus in Room AC (launched 32 SKUs/ 80% of 4Q21 sales) 2) Sri City plant (1.2mn units) to reduce logistic costs and help better serve southern...
finalization has been witnessed owing to pandemic. Management guided for 10-15% revenue growth with double digit EBIDTA margins for FY22E. optimistic owing to positive outlook on T&D; and emerging segments like Railways/Oil & Gas, healthy OB, deleveraging backed by asset monetization...
Steep rise in commodity prices and execution delays in Brazil resulted decline in EBITDA margins by 197bps YoY to 8.1%. KEC International (KECI) reported steady quarterly performance led by strong execution across its Non T&D; businesses which was partially offset by steep rise in commodity price. Non T&D; business such as Civil/Cables/Railways reported a grow of 190%/61% 39% YoY, while T&D; declined 6% YoY owing to...
Q4FY21 earnings miss for CIFC came on the back of elevated provisions (credit costs: 2.9% vs 2.6% in Q3FY21) led by additional Covid led provisions (Rs3.5bn) due to second wave and higher opex (cost-income: 38% vs 27% in Q3) due to employee incentives. CIFC witnessed marginal deterioration in asset quality at 3.96% GNPA vs 3.75% (Q3FY21), but write-offs were limited to 1% and declined in absolute terms (Rs600mn: Q4FY21 vs Rs900mn in Q3). Stage 2 at 6.2% stands lowest vs peerset with restructured stock restricted...
KNPL expects gradual demand recovery post Covid-19 stabilizes, focus on market share gains across segments. We cut our FY22/23 EPS estimates by 22.7%/5.1% mainly due to twin impacts of 1) Lower gross margins due to 13-14% input cost inflation and 2) Demand impact due to localized lockdowns and wide spread impact of Covid 19 in...
impact of second COVID wave needs close monitoring as slippages have been high. High provisions and utilization of COVID provisions of Rs21.0bn have improved coverage ratio, although buffer is now low at 37bps of loans (created in Q4FY21). Delta from past cut in SA rates and improving mix of retail both on liabilities & assets has led to NIM moving to 5.0%, while recent SA rate cuts should help lower funding cost should help improving earnings profile. We value the bank at 1.3x (from 1.0x) FY23E ABV. Capital raising &...
steady cash flows, UTCEM embarks on next round of growth with 19.5mnt of new capacities along with sizeable investment in high payback and environment friendly renewable power (WHR) to increase its share to 34% by FY24 from current 13% of overall power requirement. Led by its dominant size (22% market share) and highly efficient operations, we believe that UTCEM stands out as the best candidate to play the sector. We reiterate BUY with TP...
We cut our EPS estimates by 20.1%/4.7% in FY22/23 due to 1) Weak 1H outlook due to local restrictions 2) lower store opening assumptions by 5 stores each for FY22/23 3) interplay between average bill value and number of orders 4) sales mix impact in FY22 due to lack of non-essential sales....
Tax rate guidance at 21.5%-22% going forward We are decreasing FY22/23 EPS estimates of Dabur India by 8.0%/5.7% on back of 1) higher tax rate guidance of 21.5-22% (18-18.5% earlier) 2) lower than expected growth in Health Supplements and Healthcare and 3) no margin expansion given input cost pressures. Dabur remains cautiously optimistic given that unlike last year, localized lockdowns would not impact discretionary portfolio and sharp pick up in immunity boosting products demand from 2 nd half of April. We believe that the company will be able to...
GNPA restricted <2% at 1.98% (vs PLe: 2.1%), 2) negligible restructured book at 0.8%, 3) QoQ marginal decline in Stage 2 at 6.3%, 4) PCR maintained at high order of 50%+, 5) Prepayments hovering at ~10% levels since 2 years, 6) write offs limited to 0.3% of loans, 7) Collections healthy at 98% for individual loans, 8) sustenance of pricing power with NIMs at 3.5%, spreads: 2.3%. Co. stands ahead of the curve in proactively providing and recognizing stress (mere 1-2 payments miss leads to asset downgrades). Such a resilient...
HMCL's Q4FY21 results beat our estimates as EBITDA/Adj. PAT were better by 6-12%. This was led by higher gross margins at 29.6% (PLe 28.9%) and lower other expenses at Rs8.7b (PLe Rs9.1b). We believe headwinds such as weak demand sentiments and RM would get mitigated by HMCL's increased focus on cost control (expect LEAP 2 savings of 200bp in FY21 to continue in FY22) and price hikes. We tweak FY22/23 EPS by +3%/-2% to factor in for...
LTI reported revenues at $447.4 mn, growth of 4.6% QoQ USD, slight miss on our estimate of 4.8% QoQ USD. Growth was broad-based led by HiTech & Media (+16.4% QoQ USD) due to faster ramp up in Injazat deal, followed by BFS (+4.9% QoQ USD) and Manufacturing (+5.2% QoQ USD). BFS vertical is poised for strong growth given 1) strong demand momentum from top client...
We also like Cyient given 1) strong revenue growth momentum in DLM, 2) 4QFY21. Strong demand momentum in Communications and Healthcare verticals resulted in higher than pre-covid level revenues in these segments in FY21. Though transportation showed strong recovery in 2HFY22, but is still not back to pre-covid levels. Within this segment, there is strong pickup in automotive reflected by numerous large deals won by LTTS (2 deals), Tata Elxsi (2 deals) and KPIT (5 deals) in this domain segment. LTTS management mentioned that spends are close to pre-covid levels in US and are recovering...
We also like Cyient given 1) strong revenue growth momentum in DLM, 2) 4QFY21. Strong demand momentum in Communications and Healthcare verticals resulted in higher than pre-covid level revenues in these segments in FY21. Though transportation showed strong recovery in 2HFY22, but is still not back to pre-covid levels. Within this segment, there is strong pickup in automotive reflected by numerous large deals won by LTTS (2 deals), Tata Elxsi (2 deals) and KPIT (5 deals) in this domain segment. LTTS management mentioned that spends are close to pre-covid levels in US and are recovering...
SBI Life ended the FY21 with 6.6% of APE growth which grew 48% YoY/13% QoQ on back of 24% growth in New business premium in FY21 & 62% YoY/14% QoQ in Q4FY21. Strong top line and mix also enhanced margins to be better than expectations at 20.4% in FY21 (PLe: 19.9%) and implying 22.2% exit margin in Q4FY21 (PLe:21.2%). This led to a strong 20% YoY growth in absolute VNB. Strong growth was seen in non-par savings, individual protection, group business and recovery in ULIPs happening quarter to quarter. Going ahead, with non-par (both saving & protection) still at 23-24%...
KMB's earnings of Rs16.8bn (PLe: Rs16.9bn) was in-line with expectations though certain line items were weak. NII growth of 8% YoY/flat QoQ and higher provisions of Rs11.8bn dragged quality of earnings. Asset quality though was stable and other stress indicators of restructuring+SMA2 was only 23bps of loan. Bank carries a 57bps of COVID provision though would have comforted us if it was higher and similarly with PCR which was at 63%, lower amongst peers. Bank has continued with its stance of lending judiciously without letting guard down and underwriting remains paramount....
Working Capital down to 20 days (from 95) CRIN reported mixed results with topline flat @ Rs28.5bn YoY (PLe 8% degrowth), but EBITDA declined 33% YoY @ Rs2.6bn (PLe Rs 3.6 bn) driven by RM cost inflation. The company became net cash due to robust cash generation led by healthy performance in FY21, higher inflow of subsidy (recd Rs50bn in FY) and lower working capital driven by 34-day decline in receivables. CP segment clocked healthy topline growth, but margins were under marginal stress due to pricing pressure from international...
retail saw a multi-year low growth. A few segments/sectors stood out on growth with medium industry growing at 29% YoY/5% MoM, trade at 12% YoY/6% MoM, credit to HFCs at 17% YoY/11% MoM, gold loans at 82% YoY/8%...
