Capgemini's 2021 revenue growth of guidance 7-9% in CC terms is inclusive of an impact of 450bps from the acquisition of Altran (an extra 105 days) and divestiture of Odigo, a BPS business. Organic growth is therefore 2.5%-4.5%. This is not very different from the 24% organic growth guidance of Accenture for FY21 (Compressed transformations to drive upward revision in outlook). Both seem poised to lose market share to the top India heritage players (TCS, Infosys and HCL Technologies) who we think will post double digit growth in USD revenue in FY22. Capgemini at the mid-point of the guidance will possibly be a US$20.5bn revenue company in 2021 (at current exchange rate) - ~20% smaller in size to TCS (FY22) but ~20% larger than Infosys. However with its size Capgemini remains a key...
Corporate earnings further gained momentum as economic activity rebounded in the post Covid unlocking era with optimism fuelled by the festive season. Q3FY21 earnings staged an impressive show and were broadly ahead of estimates as corporates continue to benefit from lower raw material costs and realised leaner cost structures. Management commentary was enthused by the recent growth oriented Union Budget by the central government with conducive macroeconomics supporting healthy growth prospects, going forward....
Prices stable in Feb; cost inflation not passed on but discounts lower Mangesh Bhadang The first fortnight of Feb'21 saw better demand across regions with hitherto weaker regions like South and West also reporting decent growth in volume. Demand from non-trade segment improved whereas rural demand remained strong. Cement prices remained stable across regions with minor changes seen across various cities. However, the expected cost inflation has not been passed on to the consumers. Discounts have come down across regions and there has also been a marginal decline in the gap between trade and non-trade pricing. Based on our channel checks, cement price on a pan-India level has marginally declined by...
Highly modular nature of capex with initial focus on CNG to ensure high ROCE. We hosted four CGD players, a retired policy expert and a Morbi based ceramic major to understand growth drivers for City Gas Distribution (CGD) sector. All CGD participants were extremely positive on growth prospects and expect accelerated development ahead. We sensed that the recent regulatory clarifications added to their comfort. Steep discounts to petrol and diesel is driving CNG volumes and overall margins for CGDs. The CGD players are fairly confident in meeting their aggressive Minimum Work Programme...
In the first fortnight of Feb'21, economic recovery held up. Google mobility indicators improved (except for work-place movement) while the Tom-Tom New Delhi traffic congestion index also moved up quite sharply. Rural unemployment rate inched up most likely on lower job creation under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) while urban unemployment improved, supported by economic recovery and the improving COVID-19 scenario. The rural growth story however continues to hold up. Rabi sowing was up 2.6% YoY at the close of the season while Kharif procurement is up 16% YoY. Electricity generation dipped from the previous fortnight but E-way bill generation was marginally higher. Bank credit growth witnessed a marginal dip from the previous fortnight on a higher base. India's merchandise exports rose by 10.3% during 1-8 Feb'21 on account of strong performance by key...
The results include the combined earnings of M&M; and Mahindra Vehicle Manufacturers (MVML), which is a manufacturing unit of M&M.; On a consolidated basis, the company reported a net profit of Rs 704 crore in Q3 December 2020, up 252% over net profit of Rs 200 crore in Q3 December 2019. Total income increased...
ONGC reported in-line sales volumes, with realization at USD43.2/bbl. Crude oil production has reached last year's levels, while gas is still marginally lower YoY due to lower offtake by customers on account of COVID-19. For FY21/FY22, the company has guided for oil production at ~22.5mmt/23mmt (flat YoY), while gas production is set to increase to ~23bcm/25bcm (+8% YoY), although lower than earlier estimates. COVID has caused further delay in KG-DWN-98/2, with the peak production target to be achieved over 202324. Production is likely to rise to 2.5...
Strong bid pipeline of Rs406bn public sector & Rs250bn private sector projects over 6 months, with primary focus on affordable housing and hospital projects. With sharp uptick expected in CIDCO & other key projects, company guided...
We maintain reduce rating (TP- Rs 676) on CRIN due to capacity constraints in NPK and headwinds on the raw material side starting 4Q. We are positive on Urea companies due to healthy volumes and significantly lower pending subsidy burden aiding savings in interest cost & improved in return ratios....
EBITDA up 62% YoY on strong volumes and margins 3QFY21 revenue/EBITDA/PAT was up 25%/62%/73% YoY to INR17.6b/INR4.5b/INR2.4b, beating our estimates by 1%/6%/3%. Volumes rose 24% YoY to 3.17mt (est. 3.15mt) Grey Cement was up 25% YoY to 2.76mt and White Cement was up 17% YoY to 0.41mt. EBITDA per ton was up 30% YoY to INR1,417/t (-3% QoQ) on account of lower cost. Blended realization was in-line at INR5,556/t (+1% QoQ; v/s est. INR5,537/t) as pricing remained steady and strong....
In our previous report of Chartwatchers (Jan'20) we had cautioned about the market crash and US entering into recession in the 1st quarter of the year.
The business growth of the bank remained in double digit, while the bank has maintained healthy CASA deposits ratio at 45.2% end December 2020. The asset quality of the bank has remained stable including proforma slippages of loans. Bank has improved Net Interest Margin (NIM) on sequential basis to 3.09 helping Net Interest Income (NII) to rise 4% in Q3FY2021. Bank has maintained healthy business growth at 11% along with rise in credit deposit ratio on...
We upgrade SUMICHEM to ACCUMULATE (from HOLD) with revised target price of Rs 336 (Previous 307) based on 38x FY23 EPS of Rs 8.8. We increase EBITDA/APAT estimates of SUMICHEM by 7%/7% for FY21, 7%/6% for FY22 and 13%/11% for FY23 to factor in better margins. The company reported strong results driven by better realisations for Glyphosate (prices up 20% YoY in Q3), traction in PGR (Plant growth regulator) sales and healthy growth in branded sales. SUMICHEM may continue to earn better margins on...
State Bank of India (SBI) has delivered a strong result on operating and assets quality front. Moreover, reported gross slippages stood minuscule at 2.8bn v/s 30.8bn in the previous quarter. 9MFY21, pro-forma slippages stood at 164.6bn. It reported GNPA (4.77% v/s 5.28% in 2QFY21) and NNPA (1.23% v/s 1.59% in 2QFY21) declined substantially along with higher PCR (incl. AUCA) of 90.2%. The Pro-forma GNPA/NNPA ratio declined sequentially to 5.44%/1.81% v/s 5.88%/2.08% in the previous quarter. The bank has witnessed stable net advances (7.6% YoY & 3.2% QoQ) and strong deposit growth (13.6% YoY & 1.9% QoQ) sequentially with better liquidity position (LCR of 140% +). Moreover the bank has reported PAT of 52bn (v/s 45.7bn in 2QFY21) on back of steady...
Background: AU SFB, initially incorporated as a vehicle finance company in 1996, was transformed into a Small Finance Bank in April 2017. The bank has presence in 15 states and 2 union territories, with 714 branches, 341 ATMs, 31 asset centers and ~6,59,904 loan accounts. The bank offers a comprehensive and tailor made range of products (both asset and liability) and services to cater to the needs of various businessmen (SME and MSME) and other middle and low...
