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Automotive OEM production has ramped up significantly across segments over the past six months, with general near to medium term outlook remaining positive - partly on account of pent-up demand. Ensuing improved prospects for the entire channel (aftermarket revival started earlier) are set to benefit ARBL. Industrial demand has also been encouraging in the post Covid months. We expect continued traction there, with overall FY21E-23E sales CAGR at 11.2%. During Q3FY21, other expenses rose sequentially (absolute quantum as well as on percentage of...

Background Greaves Cotton (GCL) is one of the largest manufacturers (primarily) single cylinder (diesel, gasoline engines) and dual cylinder engines, which find application in running 3-W vehicles and 4-W small commercial vehicles (SCVs). The company offers products and solutions across business units- Engines, power, farm equipment, mobility and aftermarket. In FY19 Greaves Cotton augmented its Clean Technology...

Volumes Picking Up Gradually, but We Expect Stress to Remain in FY22E: Recovery is clearly visible from the latest two quarterly numbers, with YoY revenues in Q2FY21 and Q3FY21 coming in at 51% and 74% of the numbers seen in the corresponding quarters in the previous year.

We continue to believe that most near to medium term drivers are priced in. However, on account of expected aggressive store expansion in India, we increase our EPS by 3% for FY22/23. The stock is valued at 81 and 65 P/E on FY22/FY23 EPS. We increase our target multiple to 55x P/E (50x earlier) and derive TP of Rs 2,500. We maintain our REDUCE rating. JFL is a far superior company among QSR peers but we see earnings surprises more for other discretionary companies (driven by pent-up, market share gain, pricing, sourcing advantage, make in India etc). Jubilant FoodWorks (JFL) announced the acquisition of Fides Food Systems Coperatief U.A., Netherlands (Fides) for GBP 24.8mn (INR 2.5bn). Fides is the beneficial owner of 32.81% of equity shares of DP Eurasia N.V. (DP Eurasia). DP Eurasia is the exclusive master franchisee of the Dominos Pizza brand, having 771 stores in Turkey, Russia, Azerbaijan and Georgia. It is listed with London Stock Exchange PLC. DP Eurasia has weak financials (due to operational losses in ex-Turkey, financial leverage and currency impact) resulting in a crack in its stock price over the past 3 years (GBX 250 in 2018 to GBX 70 now). The deal is valued at 8x EV/EBITDA of CY19.

ABB India manufactures heavy engineering & industrial equipment and undertakes engineering and construction projects. The company operates mainly through the Robotics & Motion, Electrification products and...

Near term growth momentum depends on the demand for industrial and protective coatings which further depends on macro environment recovery. Also, competitive pressures and raw material price fluctuation could impact the business prospects in long-term. Hence, considering the extended valuation, we downgrade our rating on the...

IPM is struggling for growth above 10% even after MoM abating COVID concerns and with MRs, physician activities almost reaching pre-COVID level. We believe key reasons for growth below par are (i) subdued new prescription (Rx) leading to volume de-growth (ii) digital marketing yield going south and (iii) sustained lower demand of acute products. Cardiac and anti-diabetic growth takes a breather in Jan-21 at 8.8% and 5.3% after reporting double digit growth in most months during lockdown. While amongst top therapies Gastro and VMN reported double digit growth of 14%...

ICHNOS Sciences fund raising to get further delayed. We reduce our earnings estimate by 1% for FY22/23E as we lower our growth projections for semi-regulated market. 3QFY21 earnings were in-line with our estimates led by growth in India formulations and cost rationalization. GNP is our top sell idea given 1) US derma portfolio (35% of US revenue) would lag growth due to competition 2) has thin US product pipeline with only 47 pending ANDAs plus guidance of 8-10 new launches in FY21E, 3) 60-65% of...

Overall churn rate moderates; post-paid base loss continues Some improvement was seen across KPIs. The subscriber base declined by ~2 million (mn) to 269.8 mn (much lower than last four quarter's run rate of ~9.8 mn decline), with churn rate reducing to 2.3% (vs. 2.6% in Q2FY21), which, we believe, is due to network integration completion. The 4G sub base saw a modest addition of ~3 mn QoQ to 109.7 million, albeit better than 1.5 mn addition in Q2. The post-paid sub base at 20.8 mn, however, was down by 0.4 mn QoQ. Similarly, capex at | 970 crore (vs. ~| 1040 crore...

Background: Berger Paints is the second largest decorative paint company in India. The Company operates seven manufacturing facilities spread across India, and four overseas manufacturing facilities. The company has second largest distribution network of ~11,500 active dealers and ~12,000 tinting machines. Berger has a strong presence in East and North India, which accounts for 60% of its distribution network while South & West India accounts for 40% of distribution network. Company derives ~80% of revenue from decorative paints and the rest from industrial paints of which Automotives accounts for 8%, powder coating accounts for 2%...