Religare Broker Research reports

Garware Wall Ropes Ltd (GWRL) reported impressive numbers for Q1FY18 with net revenue and PAT growth of 11.8% & 31.2% YoY respectively. EBITDA margin gains of 127bps YoY (15.3%) was encouraging.

Incorporated in 1988, Symphony Ltd is the world's largest air cooler manufacturer. With a pan India network of 1,000 distributors & 30,000 retailers, Symphony offers a wide product range across residential air coolers, packaged air coolers and central air coolers.

Q1FY18 corporate earnings tepid performance can mainly be attributed to de-stocking in major sectors before the GST roll-out. However, going forward, we expect sustainable recovery in earnings from H2FY18, which is also important from market standpoint considering that the market valuation is at premium from the near-term perspective. Moreover, while nothing much changes for the medium-to-long-term India growth story, in the short-term, geopolitical concerns and corporate earnings recovery, along with the Governments reform agendas, will decide the course of the Indian stockmarket. We maintain our positive outlook on Indian equities and continue to advocate taking advantage of any correction in the market.

Nifty futures have rolled around 58% vs 68% with respect to last month, and the Open Interest for the new September contract is lower by around 7lkh implying cautious outlook or profit booking at 10000-10100 levels. BankNifty futures have rolled at around 68% vs 76% compared to last month. However the Open Interest of BankNifty futures in this September series is also less by around 8lkh, implying long unwinding.

Castrol India Ltd (CIL) reported disappointing numbers for Q2CY17 with a net revenue and PAT de-growth of 10.3% & 33.3% YoY respectively. A sharp fall in the gross margins (-629 bps) and EBITDA margins (-861bps) was disappointing. Steep volume decline in CV segment, muted realisations and higher base oil prices impacted the overall growth.

Mayur Uniquoters Ltd. (MUL) reported better than expected Q1FY18 result. Net sales increased by 8.9% YoY while EBITDA/PAT was higher by 4.9%/4.2% YoY. The management has guided double digit sales growth with stable margins in FY18. Further, the company's PVC and PU capacity expansion plans are on track and the plants will be operational in H2FY19E.

Swaraj Engines Ltd (SEL) reported broadly in-line numbers for Q1FY18 with net revenue and PAT growth of 13% & 13.2% YoY respectively. EBITDA margins improved marginally by 11bps YoY at 16.6%.

Mold-Tek Packaging's Revenue and Net profit increased by 10.4% and 1.2% respectively on YoY basis. The company reported a sub-par quarter due to subdued demand mainly from paint and lubricant segments on account of GST transition.

Jamna Auto reported dismal set of Q1FY18 result due to slowdown in MHCV segment on account of GST implementation. Total income and Net profit declined by 18.5% and 35.9% on YoY basis. However, we expect demand for MHCVs to revive in H2FY18, given bright outlook for the Indian economy and falling interest cost.

Jain Irrigation Systems Ltd (JISL) reported slightly subdued Q1FY18 result, largely owing to GST related destocking. Net sales increased by 1.3% YoY while EBITDA and PAT declined by 1.4% and 4.1% respectively over Q1FY17.