Buy Nalco Ltd For Target Rs.77.00 - Motilal Oswal

Higher power and RM cost drive weak 2QFY17 performance

To benefit from sharp increase in alumina prices; reiterate Buy

NACL’s 2QFY17 EBITDA declined 11% QoQ to INR1.7b (below our estimate of INR2.5b) on higher raw material and power cost. PAT declined 10% QoQ to INR1.2b (against our estimate of INR1.3b).

16/12/2016 11:56:08 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Ashok Leyland Ltd For Target Rs.90.00 - Reliance Sec

Background & Business

Chennai-headquartered Ashok Leyland (ALL) – founded in 1948 – is the flagship company of Hinduja Group. It is the second largest CV manufacturer in India. ALL also manufactures spare parts and engines for industrial and marine applications. It also supplies logistics vehicles to the Indian Army.

 

16/12/2016 11:50:02 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Manpasand Beverages Ltd For Target Rs.761.00 - Motilal Oswal

Demonetization to have limited impact:

The company reported flat sales growth in November, mainly due to the cash crunch post demonetization. However, management expects growth of ~5-10% in December with improving new currency circulation. We believe demand for Mango Sip and Fruits Up should not be affected much once the demonetization-led impact subs

15/12/2016 12:26:14 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Godrej Consumer Products Ltd For Target Rs.1,665.00 - Sharekhan

We interacted with the management of Godrej Consumer Products (GCPL) to gauge the impact of demonetisation on the company’s domestic business. Some of the key highlights of our interaction are as follows.

 

Key points

* Impact of demonetisation limited to domestic business; Wholesale channel materially hit

15/12/2016 12:14:15 PM | Posted in Broking Firm Views - Long Term Report read full news
Sell National Aluminium Company Ltd For Target Rs.55.00 - Kotak Sec

NALCO's 2QFY17 performance, was below our expectations. Net sales during the quarter declined 4.2% YoY to Rs18.46bn (up 19.2% QoQ) on account of lower alumina sales volume and realisation. EBITDA declined 50.6%/11.5% YoY/QoQ to Rs1.72bn, with an EBITDA margin of 9.3%. PAT declined 51.7%/10.2% YoY/QoQ to Rs1.21bn. We believe that, the decline in operating performance was on account of the di

15/12/2016 11:52:39 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy CESC Ltd For Target Rs.720.00 - Sharekhan

Key points

* Steady standalone earnings performance:

For Q2FY2017, CESC’s total revenue grew by 6% YoY to Rs1,956 crore, driven by 3% YoY rise in volume and 2% YoY increase in tariff. While Power Generation declined by 13% YoY to 1,716 MU, Power Purchase increased by 24% YoY to 1,398 MU, as a substanti

15/12/2016 11:44:35 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sun Pharmaceutical Industries Ltd For Target Rs.820.00 - Reliance Sec

The United States Food & Drug Administration (US FDA) inspected Halol facility of Sun Pharmaceutical Industries (SUNP) from November 17, 2016 to December 01, 2016 and issued Form-483 with nine observations. However, according to SUNP, none of them are repeat observations. We view these observations (Source: ET Now) are of low to moderate in nature (relating to contamination across sterile a

15/12/2016 11:28:16 AM | Posted in Broking Firm Views - Long Term Report read full news
Reduce Godrej Consumer Products Ltd For Target Rs.1481.00 -  Kotak Securities

We provide a summary of the key matters discussed in conference call of GCPL management with analysts, as related with India operations, and the company's reaction/ expectations as regards demonetization. On account of demand/supply chain issues that the industry is likely to face as also higher raw material prices (palm oil/ crude) which shall impact the company, we cut our FY18E EPS by 4%

14/12/2016 11:51:58 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Jindal Steel & Power Ltd For Target Rs.100.00 - Prabhudas

Jindal Steel and Power (JSP) reported Q2FY17 earnings below our expectation due to lower than estimated earnings in steel operations. JSP would be best placed to exploit the benefit of steep increase in steel prices as 70% of its production comes through non‐coking coal route. Earnings outlook for FY18 remains strong on the back of better outlook on steel prices, commissioning of BF in Angul

14/12/2016 11:51:43 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy PNC Infratech Ltd For Target Rs.142.00 -  Kotak Securities

PNC Infratech has reported weak Q2FY17 results. The standalone net sales (EPC Business) for the quarter declined by 23.3% yoy to Rs 3.6 bn (Vs our estimates of Rs 5.08) bn on account of heavy rains in the region negatively impacting execution. The EBITDA margin for the quarter at 12.9% was broadly inline with our estimates of 13%. We believe that the execution would pick-up in Q3FY17 lead by co

14/12/2016 11:42:15 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sun Pharmaceuticals Industries Ltd For Target Rs.875.00 - RCML

Halol 483’s – A read-through

* No data integrity issues raised:

We assessed the USFDA’s 483 letter for SUNP’s Halol plant. Our reading suggests: (a) none of the observations are a repeat of the warning letter and (b) the observations largely relate to SOPs (standard operating procedur

14/12/2016 11:27:36 AM | Posted in Broking Firm Views - Long Term Report read full news
Sell Reliance Defence And Engineering Ltd For Target Rs.48.00 -  Kotak Securities

Financial performance of Reliance Defence (RELD) has improved in the last 2 quarters after a change in the management of the company, still it is very poor and requires a big turnaround (both sectoral and company wise) for investors to invest in the stock. Shipbuilding market remains weak with poor demand, increased competition and environmental regulations. During H1FY17, RELD has signed few i

14/12/2016 11:25:53 AM | Posted in Broking Firm Views - Long Term Report read full news
Hold Bajaj Finance Ltd For Target Rs.1,010.00 - Sharekhan

We attended the conference call of Bajaj Finance (BFL), where the management shared its view on the impact of demonetisation on the company’s business. The key takeaways are:

* Outlook unclear; medium-term challenges persist:

The Government’s demonetisation move has adversely impacted the overall financial industry, and BFL is no

14/12/2016 11:18:15 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy J.Kumar Infraprojects Ltd For Target Rs.253.00 - Prabhudas

* Extended monsoon impact execution:

J.Kumar Infra (JKIL) reported sales of Rs3.09bn (down ~6.4% YoY) in Q2FY17, EBITDA at Rs563mn down 6% YoY, while EBITDA margins were up 10bps YoY to 18.2%. PBT was up 6% YoY to Rs 317Mn consequent to increase in other income by 106% to Rs 61mn. PAT was up by 5% YoY to Rs 230mn.The Company has since commenced work on

14/12/2016 11:13:12 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Titan Company Ltd For Target Rs.400.00 - Emkay Global

Competitive positioning to improve; Upgrade to BUY

* Demonetization had an initial impact on sales, however, there has been a gradual improvement driven by gold exchange scheme. While sales are down YoY, the decline in not as high as 30%. About 60% of Titan’s sales are through the digital mode.

* GST and demonetization will increase the

13/12/2016 12:32:52 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy State Bank of India For Target Rs.320.00 - Sharekhan

Key points

* SBI Life valuation improves post stake sale; Positive development:

State Bank of India (SBI) has agreed to sell a 3.9% stake in SBI Life (SBIL) to KKR and Temasek for Rs460 per share. SBI currently holds a 74% stake in SBIL while the balance is held by BNP Paribas Cardiff (the life, property and

13/12/2016 12:27:10 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold CESC Ltd For Target Rs.674.00 - Emkay Global

* Distribution business operating performance was above expectations (core RoE at 6.1% vs expectation of 4.7%). Generation was down 13.1% YoY to 1.7 bn, while power purchases was up 24.3% YoY to 1.4 bn in Q2FY17. Units sold was 2.7 bn (up 3.4% YoY)

* Losses of Spencer’s Retail at EBITDA level is approaching breakeven now. We expect Spencer’s to achieve EBITDA breakeven ful

13/12/2016 12:24:15 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy V-Guard Industries Ltd For Target Rs.210.00 - Sharekhan

We attended the conference call of V-Guard Industries, where the management shared its view on demonetisation impact on the company’s business. The key takeaways are:

 

* Impact of demonetisation:

1) The company witnessed deferent of discretionary consumer spending, especially in the Southern markets (mainly Kerala due t

13/12/2016 12:14:46 PM | Posted in Broking Firm Views - Long Term Report read full news
Sell NMDC Ltd For Target Rs.101.00 - Emkay Global

Better than expected performance!

*Better than expected performance driven by higher sales volume and stronger than expected realizations. Topline for the quarter rose 8.5% YoY and 1% QoQ to Rs 17.4 bn. Sales volume stood at 8.06 mt. Realization stood at Rs 2117/ tonne, despite price cuts

* EBITDA fell 8.5% YoY, however rose 1.2% QoQ to Rs 8.

13/12/2016 11:50:33 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy J. Kumar Infraprojects Ltd For Target Price Rs.290.00 - Reliance Sec

Impacted by extended monsoon and absence of revenue booking from new projects, topline of J. Kumar Infraprojects (JKIL) declined by ~6% yoy to Rs3.03bn in 2QFY17 vs. our estimate of Rs3.5bn. While EBITDA declined by ~2% yoy & ~10% qoq to Rs498mn, EBITDA margin rose by 64bps yoy to 16.4% mainly owing to high-margin work components. JKIL’s net profit grew by 5% yoy and declined ~23% qoq

13/12/2016 11:25:29 AM | Posted in Broking Firm Views - Long Term Report read full news
Sell Crompton Greaves Ltd For Target Rs.59.00 – Kotak Sec

CG management has confirmed that the ongoing transaction involving sale of international power business in Europe, North America and Indonesia to Pauwels Spaco (a SPV of First Reserve) stands terminated.

We cut FY17/ FY18 earnings estimate to factor in lower than anticipated volume pickup in domestic power systems business and potential increase in losses from the international power

12/12/2016 12:06:54 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold Crompton Greaves Ltd For Target Rs.70.00 - Sharekhan

Key points

* Dismal show in continued operations; stable standalone earnings in Q2FY2017:

Crompton Greaves (CGL) reported disappointing operational performance at a consolidated level in Q2FY2017. The operating profit declined by 36% YoY to Rs83 crore (below our estimate) due to a dismal performance by its i

12/12/2016 12:05:16 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Finolex Industries Ltd For Target Rs.493.00 – Kotak Sec

Finolex Industries Q2FY17 results were better than our estimates at operating level. Net revenue (net of excise) for the quarter declined by 2% yoy to Rs 4.57 bn (Vs estimates of Rs 5 bn) with PVC pipes volume declining by 6% as against our estimates of 14% growth. The decline in volume was on account of strong monsoon season over last year, which negatively impacted demand during the season. T

12/12/2016 12:00:41 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Gujarat Industries Power Company Ltd For Traget Rs.116.00 - Emkay Global

Results above expectation; Reiterate a BUY

* GIPCL reported strong Q2FY17 numbers surpassing our and consensus estimate due to higher other income and improved YoY PLF during the quarter. PAT increased 32.7% YoY to Rs505mn and was above our estimates of Rs391mn.

* PLF improved across Vadodara II to 21.8% vs 5.7% YoY and Surat II plants to 63.

12/12/2016 10:59:50 AM | Posted in Broking Firm Views - Long Term Report read full news