Voltas held an analyst meet earlier today. Key takeaways: While there was massive destocking in Q1FY18 due to lack of clarity on deemed GST credit, sale in secondary trade channel was strong at 17% YoY.

KNR Constructions Limited is an India-based holding company. The Company is a multidomain infrastructure project development company. The Company undertakes engineering, procurement and construction (EPC) contracts, as well as build-operatetransfer (BOT) projects across various sectors, such as construction and maintenance of roads, highways, flyovers and bridges. Its range of verticals also include irrigation projects, water management, agriculture and trading business. It has completed approximately 5,890 kilometers of projects across over 10 states in India. Its urban water infrastructure management project is Challaghatta Main Valley Project, which involves the remodeling of primary and secondary storm drains, bridges/culverts and related works in Challaghatta Main Valley in Bangalore City. The Company's irrigation...

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Mold-Tek Packaging (MTPL) in 1QFY18 posted consolidated revenues of Rs. 90 Cr. (up 8% Y-o-Y, up 9% Q-o-Q)due to increased contribution from Food and FMCG segment and huge growth in RAK plant sales however GST impacted paints and lubes volumes due to destocking.

Maintain NEU with a revised TP of Rs 306 (20x SEL's consol Jun-19E EPS) Suprajit Engineerings (SEL) consolidated 1QFY18 result came in below estimates, with PAT at Rs 226mn (+7% YoY), led by lower operating efficiencies. Revenue witnessed a jump of 27% YoY to Rs 3.2bn, while EBIDTA margin contracted sharply to 14.3% (-290bps YoY, -360bps QoQ).

lower than last year on account of preponement of purchases due to discounts offeredtoclearthepreGSTstock.3)TheaveragetaxratepostGSThasgoneupby 200bps(28%v/s26%);however,Voltashasnottakenanypricehikes.4)Working onincreasingshareofInverterACfromthecurrent6%oftheACSales.5)Launchof productsfromArcelikJVdelayedduetodelayinregistrationofthecompany.6)In theMEPsegment,nomajorexecutionissuesinQatarexpected;however,domestic...

We met with the management of Voltas and following were the key takeaways from the meeting: a) primary sales towards festive season (Diwali/Dussehra) was weaker than expectations, b) GST implementation led to 2% increase in effective tax rate, but company has not rolled out any price increase as 2Q/3Q are lean seasons, c) Voltas-Arcelik JV products to be launched by 4QFY18 (pushed from 3Q) and the plant is expected to be commissioned in 18 months after location is finalised, d) Voltas is No.4 player in inverter AC market (6% market share) as its focuses on the fixed speed AC segment given management's view that demand in that segment is still intact and e) projects division may see some near term...

We had a meeting recently with Mr. R. K. Gupta, Chief Financial Officer (CFO) of Bata India (BIL) to understand recent developments in the company's business. The CFO was upbeat about BIL's future prospects and expects it to register double-digit...

We had a meeting recently with Mr. R. K. Gupta, Chief Financial Officer (CFO) of Bata India (BIL) to understand recent developments in the company's business. The CFO was upbeat about BIL's future prospects and expects it to register double-digit...

Minda Ind reported Total revenues of Rs 1,032 cr in the quarter ending June 2017. The company reported EBIDTA of Rs 110 cr with robust EBIDTA margin of 10.7% (expansion of 123 bps (YoY)).

Bharat Road Network Ltd (BRNL), is a BOT company, which is focused on development, implementation, operation and maintenance of roads and highway projects. The company manages over Rs6,685cr of road assets including five operating projects and one under construction project aggregating to 2,095 lane km, with average residual life of appro..

We met the management of Hindustan Zinc (HZ) and visited Dariba complex to understand the status of expansion projects and outlook on Zinc market. Managementreiterated their guidance ofmined metal output of 1.2mtpa in CY20. CompanyguidedtodoubletheSilverproductionto100ktpainthenextthreeyears. Withoutspecifyingthetimeline,managementsharedtheirplantoexpandthemined metalcapacityto1.5mtpa.TheoutlookonZincpricescontinuedtoremainfirmon thebackofrecordfallininventorylevels,continueddemandgrowthanddearthof new supplies. Driven by strong outlook on zinc and HZ's quality operations, we...

DLF announced the DCCDL transaction with GIC valuing the former at equity value of Rs 302 bn (implied cap rate of ~8%, in line with market valuation). Post the deal, management expects to reduce debt in DevCo to Rs 20 bn (from Rs 165 bn)

Suboxone litigation in favor of DRRD; US FDA approval key The District Court of Delaware (US) has ruled in favor of Dr. Reddy's (DRRD) in the Suboxone litigation. The court found the patents 150, 514, 497 valid and non-infringing. According to IMS, secondary sales for Suboxone films stood at USD1.7b (primary: USD850m) in CY16. In August 2016, DRRD had acquired eight ANDAs, including...

Gross Sales stood at INR 10,225 Mn which was up by 26.13% Y-o-Y, slightly below our estimates of INR 10,903 Mn. The sales of the company slowed down Q-o-Q majorly resulting out of de-growth in after market segment by 39% Q-o-Q, followed by Lighting division arising out of muted growth in automobile industry. However, on yearly basis Lighting division (54% Y-o-Y) and Alloy Wheel business (46% Y-o-Y including blow-molding) continued to deliver strong growth for the company. EBIDTA stood at INR 1,010 Mn which was increased by 38.92% y-o-y, but much below our estimates of INR 1,210. EBIDTA margin stood at 9.9% against our estimate of 11.1%. This was on account of increase employee cost increased as % of sales by (40bps Y-o-Y and 80bps Q-o-Q). The management of the company pointed out that the employee costs increases in the beginning of every year. PAT came in at INR 515 Mn which was up by 85.22% y-o-y but below our estimates of INR 648 Mn. PAT Margin stood at 4.4% which slightly below our...

Steady Volume Growth in the Face of Challenging Environmentand Gross Margins Diluted by Higher Input Cost: Britannia has delivered a steady overall volume growth of 2.5% in Q1FY18 under the challenging market conditions and destocking due to GST, when compared to 2.0% volume growth in Q4FY17. During the quarter, Britannia has reported Total Revenue from Operations (without including Other Income) at Rs.23398 Mn, posting YoY growth of 6.5% when compared to Rs.21966 Mn in Q1FY17.

Near term outlook: Whilst the game changer augurs well for balance sheet and leaves scope for office asset expansion in newer geographies, residential business remains dull. Any meaningful acceleration in nearing completion residential inventory of Rs 145bn will lead to further re-rating. We maintain NEUTRAL. Much awaited Game Changer happens finally, with GIC buying out DLF promoter stake in DCCDL. Post the Promoter and QIP fund infusion of ~Rs 130bn, DLF net D/E will reduce from current 1.05x to 0.31x. The interest cost will reduce to less than half from current annual run-rate of Rs 30bn/yr. Deal values stake sale to GIC at an Enterprise Valuation of Rs 356bn and Equity Valuation of Rs 302bn. Deal valuation is higher than our estimate of Rs 263bn. The implied cap rate post deduction of the FSI value of under development assets is 8.4%.

We contacted 50 stores of Bata India (BIL) spread across Mumbai (25 stores), Pune (5 stores), Hyderabad (5 stores), Kolkata (9 stores) and Delhi (6 stores). These stores, on an average, have been set up since the past 25 years with the median age of stores in Mumbai being eight years and those in other cities being 15 years. Except for three stores out of 50, all were in operation for at least three years or more. We found that barring Delhi, demand is good with same-store sales growth (SSG) at ~10% YTD. Footfalls were abysmally low at stores in Delhi during June and July 2017 on account of uncertainty...

Q1 EBITDA margin at 3% was at multi-year low due to negative operating leverage led by 17% YoY decline in domestic formulations (on GST transition) and 14% YoY decline in export formulations (USFDA issues & UK currency impact).

While restocking-led recovery is seen in Q2 (General Trade growth at 18% in July), Jyothy Laboratories (JYL) went on fixing issues at different channels of supply chain: (i) impact of wholesale disturbance by strategizing to reach affected centers via new sub-stockists