Maintain BUY with a TP of Rs 1,035 (18x Jun-19E and Rs 135/sh for pipeline). Glenmarks (GNP) 1QFY18 performance was in stark contrast to that in the previous quarter. The overall top-line grew 23% YoY, largely on the back of ~50% growth in the US business (gZetia impact). Revenue was also surprisingly boosted by a 15% growth in the India business, despite the GST disruption in the domestic market. The EBITDA margin came in at 23.3%, in line with estimates, up 640bps YoY. PAT grew ~44% YoY to ~Rs 3.2bn.

Maintain BUY with a revised SOTP of Rs 338 (1.9x FY19E core ABV of Rs 132 and sub-value of Rs 88/sh. ICICIBCs 1Q performance was a tad disappointing on the core front, as NIMs dipped and growth slowed optically. While the slippages were lower (despite one large non-watchlist NPA) and the restructured book almost halved the net stressed assets were stable, as watchlist increased 7% QoQ.

Downgrade to SELL with a TP of Rs 2,275 (17x Jun19E). Dr. Reddys Labs (DRRD) posted weak numbers, with the top-line growing only ~3% YoY in 1QFY18. This was led by a 3% decline in the US business and a 10% decline in domestic revenues. The EBITDA margin came in at 9.2%, sinking ~700bps QoQ, with the gross margin plummeting to 51.5% during the quarter. Incremental competition in the US continues to erode profits in the absence of new lucrative product launches. The impact of GST on the domestic business also contributed to the margin decline. PAT was Rs 591mn, down 53% YoY despite the low base.

Q1FY18 revenue was largely in line led by Retail and BFSI (up ~9% QoQ, aggregate share at ~47%). Execution was strong with increase in offshore revenue share and utilization rates. However, higher onsite efforts and currency impacted the margin (10% vs. our estimate: 12%). Higher depreciation/amorti..

In the concall, the management highlighted that its domestic motorcycle market share has suffered due to the recent transition from BS-3 to BS-4 emission norms where all players except Bajaj saw huge pre-buy (at a high discount) and consequently dry channel which was filled last quarter. It expe..

Dr Reddy's Laboratories' (DRL) 1QFY18 earnings performance was below our as well as consensus expectations. Revenue for the quarter stood at Rs33,332mn, a sequential decline of 8% and well below consensus estimate/our estimate by 4%/5%, respectively. The decline was because of higher than-expected price erosion in the US market and a more severe impact of Goods and Services Tax or GST-related destocking in India. PAT declined 80%/57% to Rs666mn on QoQ/YoY basis, respectively, (below our/consensus estimates by 77%/78%, respectively). The decline in net earnings was steeper because of higher cost of sales (price erosion), and a sharp increase in research and development or R&D; and SG&A; expenses during the quarter....

Supreme Industries' (SIL) 1QFY18 net sales declined 2% to Rs11,617mn (9% below our estimate of Rs12,794mn) against Rs11,893mn in the same quarter a year ago. Volume declined ~5% from 97,045mt to 92,196mt during the quarter. Except for industrial products, which grew 6%, volume in other segments such as plastic pipes/packaging products/consumer products declined7%/2%/8% respectively. Gross margin declined 550bps to 33.5% against 39.0% in the same quarter a year ago. The fall can mainly be attributed to inventory loss and lower contribution of value added products (VAP) to total sales. Lower gross margin led to decline in EBITDA margin by 330bps to 13.7%. EBITDA...

Biocon's revenues in 1QFY18 remained flattish at Rs9,337mn, posting sequential growth of 0.3% and YoY decline of 5%. They were below our/consensus estimates by 5%/6%, respectively. The revenue decline was on account of: sluggish API sales impacting the small molecule segment (down 8% QoQ), lower licencing income, channel destocking because of Goods and Services Tax or GST implementation in India, a weak US dollar impacting exports and continuous impact of Syngene performance after a fire incident there in December last year. Revival of growth in the near term hinges on successful approval and launch of biosimilars in emerging markets which, in our view, will be a gradual process and gain...

Cigarettes do well before moving on to the GST regime ITC has reported a decent set of numbers for 1QFY18. Although revenues fell by 0.8% YoY to Rs98.7bn, EBITDA increased by 7% YoY to Rs36.7bn (vs. our estimate of Rs37.3bn) and net profit surged by 7.4% YoY to Rs25.6bn (vs. our estimate of Rs26bn). Its core Cigarettes business...

Supreme Industries (SI) is a plastic product manufacturer and the largest plastic processor in India, processing over 0.28mn MT annually. Company has four business verticals i.e. Plastic Piping (52%), Packaging Products (21%), Industrial Products (19%) and Consumer Products (8%). SI has 22 manufacturing plants situated across India. Company enjoys a significant market share across its business verticals; Plastic Piping (9.48%), Indus trial Products (15%) and Consumer Products (13%). Supreme Industries is the market leader in the Packaging Products segments like XLPE (50%), EPE Foam (36%), Cap Cell ( 30%) and Air Bubble Film (18%). SI's...

ICICI Securities Ltd | Retail Equity Research ONGC declared its Q1FY18 results, which were above our estimates on the topline front. The revenues increased 7.2% YoY to | 19073.5 crore and came above our estimate of | 18673.6 crore. The net...

ICICI Securities Ltd | Retail Equity Research Revenues grew 3% YoY to | 3316 crore (I-direct estimate: | 3302 crore) mainly due higher volume uptake in emerging markets and Europe as well as new launches across geographies. This was partially offset by price erosion in the US and channel destocking in the India due to GST transition EBITDA margins declined 534 bps to 9.8% (I-direct estimate: 16.3%) due to sharp 464 bps decline in gross margins to 51.6% (I-direct...

Force Motors reported poor set of Q1FY18 result led by de-stocking in OEM segment due to GST implementation from July 1, 2017. Total revenue declined 1.2%, whereas EBITDA and PAT declined 48.1% and 41.8% respectively on YoY basis.

First Sign Of Ad Rate Gap Getting Bridged - Big Re-rating Trigger While the 1QFY18 performance was below our expectation (but in line or a tad higher-thanconsensus estimate), we believe the highlight of the quarter was the first sign of bridging of the large advertisement-revenue-per-screen gap that exists between PVR and Inox Leisure (PVR's is higher by ~63% in FY17). The 40% YoY growth in this number for Inox in 1QFY18 was aided partly by premium on the rate card for the blockbuster - Baahubali 2'. However, it was indicated by Inox Leisure that the increase is also reflective of its clients acceptance of the hike in rates effected in December 2015 and that there should be a steady increase in the number from here on (after six quarters of YoY decline). We believe this has been achieved through: (1) Increasing...

Revenues of PVR in 1QFY18 were short of our expectation while EBITDA was in line. Revenues and EBITDA were up 14.5%/10.1%, respectively, on YoY basis. Growth in revenues came from strong growth in ATP (up 10% YoY), SPH (up 10% YoY) and advertisement revenues (up 31% YoY), but to our surprise there was hardly any increase in the number of footfalls despite 7% increase in the YoY number of screens (we estimated 10.5% growth). The management attributed lower footfalls to poor content except Baahubali 2' in 1QFY18. EBITDA margin declined 80bps on YoY basis (but better than our estimate) because of: (1) Lower-than-expected revenues following lacklustre performance by movies like Tubelight'. (2) Higher distributor...

Estimates broadly unchanged: We have broadly maintained our estimates for FY18/19. We expect EBITDA to increase 18.3%/15.2% in FY18E/FY19E. Also, our net profit forecasts are higher by 12.3%/16.2% for FY18E/FY19E, respectively. Outlook and valuation: We believe that Exide's focus on technology upgradation to lower costs, improvement in after-sales service and timely price hikes are likely to improve its sales/ margins over FY18-19. We value the core business at a FY19 EBIT multiple of 14x leading to standalone value of Rs222/share. We value the insurance business at 2x B/V (Rs32/share), and value the rest of the subsidiaries at 1.5x B/V...

Strong CSM franchise; maintain BUY: PI's CSM businessto benefit from (a) order book at USD 1 bn, ~4.5x FY17 CSM revenue, (b) recovery in global agrichem market from H2FY18, and (c) success in CSM-pharma.

On account of better product mix (higher share of premium brands), gross margins expanded 370 bps YoY to 59.8%. However, increase in processing charges (up 131 bps YoY) and other expenses (up 266 bps YoY) led to decline in EBITDA margins by 30 bps YoY to 10.3%....

ICICI Securities Ltd | Retail Equity Research PVR reported its Q1FY18 numbers with revenues at | 636.6 crore, up 11.6% YoY (vs. Idirect estimates of | 624.6 crore). ATP growth, at 7.5% YoY to | 214, was boosted by strong content slate in Q1FY18 led by Baahubali 2 and decent grosser such as Tubelight, Fate of the Furious and Hindi Medium. Footfalls at 21 million, down 0.3% YoY, were muted as other movies barring Baahubali 2 falied to meet expectations. The consequent net ticketing revenues were up 12.3%...

Hindustan Zinc's (HZL) Q1FY18 EBITDA at Rs 24 bn (up 111% YoY) was lower than our and consensus estimates. The YoY improvement in performance was led primarily by (1) substantial ramp-up in production from Rampura Agucha open cast mine as per the mine plan; (2) higher LME prices; and (3) stron..