Buy

Prima Plastics' (Prima) Q1FY17 result came above our expectations. Standalone revenues/EBITDA/PAT increased by 7.4%/56%/51% YoY to Rs205/20/15 mn. EBITDA margin improved 300bps YoY to 9.5% in Q1FY17. The benefit of lower RMC reflected in operational performance along with better cost management expanded margins. Further, higher operating profit was translated into healthy net profit growth of 51% YoY to Rs20 mn in Q1FY17. The company is expanding its capacity in West Africa & India and foraying its presence in Central America (through JV) which is expected to complete by early Q3FY17. Post expansion, its capacity would increase from current 14,000mt to 22,500mt. Going forward, capacity expansion, new...

During the quarter value added services (VAS) provided growth impetus while operating costs are reduced by 270 bps due to higher productivity and spreading of central costs. The Company entered into a MoU for operating...

Aided by higher capitalisation and better execution, Power Grid Corporation of India's (PGCIL) revenue surged by 29.4% yoy to Rs60.6bn in 1QFY17 topping our estimate of Rs 57.6bn. While PAT spiked by 35.5% yoy to Rs18.1bn, reported EBITDA rose by 40 bps yoy to Rs54.1bn. With huge capex in the pipeline, we believe that PGCIL's fundamentals would continue to remain strong supported by least exposure to operational risks i.e. fuel and SEBs' weak financials. Hence, we continuing to remain positive on PGCIL, we reiterate our BUY recommendation...

ACIL's reported top-line stood at Rs3.05bn (+16% yoy) mainly owing to healthy order inflow over last 2 years (added aggregate orders worth >Rs35bn in FY15 & FY16) and improved macro scenario. Further, its operating profit grew strongly by 33% yoy to Rs424mn, while EBITDA margin stood robust at 13.9%. Net profit grew by ~14% yoy...

Going forward company plans to open 20-25 Talwalkars gyms and 30-40 Zorba centers in FY17 and Valuation: We continue to remain positive on the fundamentals of the business, the company's ability to constantly innovate to improve the same store sales by offering newer services, prowess in implementing & running gyms and a strong business model. At CMP of INR 254, the stock is trading at 15.4XFY17E and...

KNR Q1FY17 performance was better than estimates on account of better execution in the recently won orders. Revenue of Rs 3.03bn (+77% YoY) and EBITDA of Rs 437mn (+78% YoY) came higher than consensus estimates of Rs 2.4bn/Rs 350mn. EBITDA margin stood at 14.4% (flat YoY), in-line with estimate. Reported PAT increased sharply by 101% YoY to Rs302 mn (much higher than estimate of Rs 160mn) primarily led by better operating profit and lower tax outgo (MAT credit entitlement). Going ahead, we maintain our estimates with 25% PAT CAGR over FY16-18E, driven by strong order backlog and pick up in execution. Maintain Buy with TP of Rs 740.

Escorts (ESC) has announced the divestment of major part of its Auto Products segment. Company's auto ancillary segment has been bleeding since long and we believe that it is a right strategic decision to focus on the core business and getting rid of loss making entities. Management has stated sale of OEM and exports division of the segment, while retaining after sales with company, which would be merged with agri business eventually. After sales business is reasonably profitable and adds to the profitability and return ratios of the company. Moreover, company would sell the plant and machinery to Pune based Badve Engineering, however, its land and building assets would be retained by Escorts for future development. This strategic decision strengthens our positive view on the management's commitment to enhance the returns by focusing on profitable segment and divesting loss making entities.

Valuation: We expect, the company's revenue/earnings to grow at a CAGR of ~13%/~48% over FY16p-18e respectively led by increasing demand for branded footwear, diversified product portfolio and reduction in raw material prices. At CMP of Rs.176, the stock is trading at a PE of 15x/12x of FY17e/18e. We maintain our BUY rating on the stock with the target price of Rs.290 (at a...

The company's sales for 1QFY2017 came in higher than expected at Rs8,007cr V/s Rs7,414cr expected and V/s Rs6,526cr in 1QFY2016, a yoy growth of 22.7%, mainly driven by exports. On the operating front, the EBITDA margin came in at 33.5% V/s 29.5% expected and V/s 23.5% in 1QFY2016, mainly driven by gross margin expansion (76.9% in 1QFY201..

ICICI Securities Ltd | Retail Equity Research Jet Airways' performance during the quarter remained weak, mainly led by a drop in realisations (down 6.5% YoY), higher employee costs (up 16.4% YoY) & depreciation charge (up 25.4% YoY). This quarter also had an exceptional loss of | 92 crore with respect to forex loss. This, in turn, led to a sharp fall in net profit in the quarter While average domestic fares dropped sharply by 10% YoY led by a rise in competition, international fares declined only 2.5% YoY. Total...