Buy Bajaj Electricals Ltd For Target Rs.483.00 - Emkay

Consumer revenue decline arrested after 9 quarters

* BJE's consumer business in 2Q recovered to flat YoY sales (adjusted to GST rate). This suggests that benefits from new distribution model have started to come in. We upgrade our TP by 20% to Rs483 as we increase target PER for consumer business to 35x FY19E (10% disc to peers) from 27x. Catalyst

2/12/2017 10:33:02 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Eicher Motors Ltd For Target Rs.34,722.00 - Motilal Oswal

Op performance in-line; RE margins stable; VECV margin beats estimate

* Consol. revenue grew ~23.5% YoY to ~INR21.7b (est. of INR22.1b), with EBITDA growth of 26% YoY to INR6.8b (est. of INR7b). However, higher tax restricted consol. PAT to INR5.2b (est. of INR5.5b) – growth of 25%.

* RE’s net realization declined 2% QoQ (+1% YoY

2/12/2017 10:28:37 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Jindal Steel & Power ltd For Target Rs.200.00 - Prabhudas Lilladher

Jindal Steel & Power (JSP) reported strong set of Q2FY18 earnings on the back of strong profitability in Shadeed operations. Recently commissioned BF at Angul operated at 50% utilisation rate in the quarter. Led by 50% growth in steel volumes and reduction in CoP at Angul by Rs3000/t (would be realised in full Q4FY18 onwards), we expect 2‐year CAGR of 40% in earnings for FY17‐FY19E. Jin

2/12/2017 10:25:36 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sun Pharmaceutical Industries Ltd For Target Rs.610.00 - Motilal Oswal

Margins improve sequentially; US remains under pressure

* Revenue fell 15% YoY to INR65.9b (2.5% miss) in 2QFY18. Gross margin shrunk 480bp YoY (-130bp QoQ) to 71.5%. EBITDA of INR13.15b was ~5% above estimate. EBITDA margin expanded to 20% v/s 17.1% in 1QFY18. Margin improvement for Taro also aided operational performance. PAT of INR9.1b was ~10% abo

2/12/2017 10:19:33 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Jindal Stainless Ltd For Target Rs.145.00 - Emkay

* Revenue stood at Rs26bn (+36% yoy/29% qoq), better than our estimate, backed by higher volume offtake at 202kt (+40% yoy/+41% qoq), and better realization at Rs1,28,816/tonne (+5% yoy/-16% qoq).

* EBITDA/tn, impacted by liquidation of high inventory cost, fell by 9% yoy to Rs12,669 (-27% qoq). Inventory adjustment stood at Rs2.8bn (vs loss of Rs92mn yoy). This led to 27% yoy increas

2/12/2017 10:13:37 AM | Posted in Broking Firm Views - Long Term Report read full news
Reduce Thermax Ltd For Target Rs.975.00 - Emkay

* Thermax (TMX) Q2FY18 operational performance was below our expectations. Revenues declined by 4% yoy impacted by GST rollout. EBIDTAM increased by 60bps yoy while PAT declined by 27% yoy.

* Order inflows increased by 14% yoy to Rs14 bn while order backlog increased by 24% yoy to Rs 53bn. Order inflows increased by 14% yoy and 11% yoy in the domestic and international segment respect

1/12/2017 3:04:35 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Oil India Ltd For Target Rs.381.00 - Kotak Sec

Oil India’s PAT for Q2FY18 is higher than our estimates. The company has reported meaningful increase in PAT to Rs.6.5 bn (43% qoq and 11% yoy) mainly on account of higher crude oil realization, higher sales volume, lower other expenses and higher other income. We expect the stock to remain in focus due to the following triggers – Rising crude oil prices, potential increase in domes

1/12/2017 2:59:44 PM | Posted in Broking Firm Views - Long Term Report read full news
Sell Motherson Sumi Systems Ltd For Target Rs.342.00 - Kotak Sec

MSSL’s 2QFY18 performance was healthy YoY but was below expectation. In the standalone business, revenue growth and EBITDA margin was lower than expected. Muted revenue growth at SMR and EBITDA margin decline at SMP also impacted consolidated performance. Consolidated revenue grew by 33% YoY (partly supported by PKC acquisition), EBITDA margin contracted by 50bps YoY and PAT grew by 21% Y

1/12/2017 2:53:08 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Ashoka Buildcon Ltd For Target Rs.260.00 - Motilal Oswal

Operating performance below expectation

* EPC biz impacted by project-specific issues, contract renegotiations: Revenue fell 14% YoY to INR3.9b in 2QFY18, below our estimate of INR4.9b, led by: a) work disruption for 50 days at the eastern peripheral highway project, b) contract renegotiations with vendors post GST rollout (impacted supply for power T

1/12/2017 2:45:26 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Mahindra and Mahindra Ltd For Target Rs.1,604.00 - Kotak Sec

M&M positively surprised on the operating front in 2QFY18. Strong tractor volume growth and superior product mix in the auto segment led to M&M+MVML’s (Mahindra Vehicle Manufacturers Limited) reported results coming in well above expectation. Over a YoY basis, revenue/EBITDA/PAT growth was 19%/35%/22% respectively. Growth in the auto segment will be largely contingent upon new pro

1/12/2017 2:42:14 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Shilpa Medicare Ltd For Target Rs.797.00 - Motilal Oswal

Margins driven by superior product mix; remains aggressive in filings

* Strong growth in sales post adjusting for shift in business to JV: Sales fell 3.4% YoY to INR2b, but were better than our estimate of INR1.9b. The sales decline can be ascribed to the transfer of the CRAMS business to a JV (since 3QFY17). Excluding the impact of this transfer, sal

1/12/2017 2:36:07 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold Indraprastha Gas Ltd For Target Rs.315.00 - Emkay

* Result is broadly in line with estimates, with EBITDA coming in at Rs2.81bn (Emkay Est: Rs2.8bn), up 1.5% qoq while PAT stood at Rs1.68bn (Emkay Est: Rs1.74bn), up by 4.7% qoq.

* Volume continued to grow, rising by 7.6% qoq to 5.22mmscmd. CNG volume grew by 3.6% qoq to 257mnkg while PNG volume improved by 10% qoq to 120mmscm.

* Sequentially, gross margin/scm remained uncha

1/12/2017 2:32:06 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy JK Lakshmi Cement Ltd For Target Rs.512.00 - Motilal Oswal

EBITDA beat led by higher-than-estimated realization

* Healthy realization in Gujarat market: JKLC’s volume increased 10% YoY (-17% QoQ) to 1.89mt (est. of 1.92mt), as capacity expansion led to strong volume growth in east. Realization rose 8% YoY (+4% QoQ) to INR4,109 (est. of INR3,814), led by healthy pricing i

1/12/2017 2:25:42 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Jagran Prakashan Ltd For Target Rs.225.00 - Motilal Oswal

Print ad market yet to recover

* PAT down 19% YoY on weak revenue growth, higher cost: Consol. revenue increased 2% YoY to INR5.7b (4% miss) in 2QFY18. Consol. EBITDA declined 9.4% YoY (15% miss), with the margin contracting 310bp YoY to 24.5% due to higher employee/other expenses. Advertising revenue increased margina

30/11/2017 4:09:46 PM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Gujarat State Petronet Ltd For Target Rs.184.00 - Motilal Oswal

EBITDA below estimate; in-line transmission volumes

Reported revenue rose 31% YoY (+13% QoQ) to INR3.3b, falling short of our estimate of INR3.6b, primarily due to lower implied tariffs. EBITDA of INR2.9b (+27% YoY, +3% QoQ) was below our estimate of INR3.1b due to higher O&M expenses of INR123/mscm (+59% YoY, +144% QoQ). PAT came in at INR1.8b (i

30/11/2017 4:04:28 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Allcargo Logistics Ltd For Target Rs.205.00 - Kotak Sec

ALL has reported strong volume growth in the key segment of Multimodal Transport Operations (MTO) at 1.43 lakh TEUs (+3% QoQ and +12% YoY), however the Container Freight Station (CFS) segment disappointed at 65,362 TEUs (-5.6% QoQ and -17% YoY) with weak Exim trade, competition and negative impact of Direct Port Delivery (DPD) mechanism. Even project division disappointed with weak private cape

30/11/2017 3:59:23 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Tata Motors For Target Rs.510.00 - Emkay

* JLR’s Q2FY18 OPM grew by +90bp yoy/ +390 bp qoq to 11.8%, above our estimate of 9.4%, owing to better mix, higher scale and benign forex. Realized forex losses are expected to be lower at GBP793mn for next 4 quarters vs GBP797 in last 2 quarters.

*  Standalone OPM expanded by +360bp yoy/ +700bp qoq to 6.2%, above our forecast of 4.4%, led by better mix, higher scale and c

30/11/2017 3:54:42 PM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Proctor and Gamble Hygiene and Health Care Ltd For Target Rs.9,267.00 - Motilal Oswal

Healthy operating performance, fair valuations

* 1QFY18 (June year-end) net sales grew 9.5% YoY (est. of -2.4%) to INR6.6b. EBITDA grew impressively by 24.0% YoY (est. of +19%) to INR1.15b. Adj. PAT rose 10.6% YoY (est. of +11.5%) to INR1.16b. Management called out a strong performance in the feminine hygiene and healt

30/11/2017 3:49:37 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Voltas Ltd For Target Rs.610.00 - Kotak Sec

Voltas delivered all-round good set of quarterly numbers led by strong performance of the MEP segment. As a result, broad numbers were higher than our estimates. Improvement in order book and sustained uptick in order intake is a positive for the MEP business.

We remain positive on the long term growth potential of the room AC industry. Voltas is the market leader and has a strong bra

30/11/2017 3:44:07 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy NMDC Ltd For Target Rs.187.00 - Motilal Oswal

Strong operating performance

Some risk to pricing, but valuations are compelling; Buy

2QFY18 adj. EBITDA grew 56% YoY (-21% QoQ) to INR12.8b. The beat of 10% is driven by higher-than-expected realization and lower cost. EBITDA is adjusted for (a) rail line doubling payment of INR92m and (b) expected credit lo

30/11/2017 3:38:30 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Glaxo Smith Kline Consumer Healthcare Ltd For Target Rs.6,551.00 - Emkay

* Q2FY18 Revenue at Rs11.1bn, up 3.3% yoy (underlying growth of 4.8%); EBITDA up 6.6% yoy to Rs2.6bn and APAT grew by 4.7% yoy to Rs1.9bn in-line with our estimates.

* Domestic revenue grew by 6.4% with volume growth at 2.4%. Exports declined by 26%. CSD channel hit by GST disruption. It has restored back to 70% of its pre-GST run rate.

*  Gross margin declined by 130bp

30/11/2017 3:32:19 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Hindustan Petroleum Corporation Ltd For Target Rs.579.00 - Motilal Oswal

EBITDA significantly below estimate; Core GRM at USD5.6/bbl

*  HPCL’s reported EBITDA of INR27.2b (+129% YoY, +76% QoQ) in 2QFY18 was significantly lower than our estimate of INR52.5b due to lower GRM and inventory gains. EBITDA adjusted for inventory gains stood at INR21.2b (+14% YoY, -34% QoQ), below our estimate of INR33.4b, led by lower

30/11/2017 3:21:04 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Coal India Ltd For Target Rs.335.00 - Motilal Oswal

Employee provisioning, other income impact results

Volume growth accelerating, concerns behind; Buy

* Coal India’s (COAL) 2QFY18 revenue grew ~12% YoY to INR181b (3% miss) on ~13% growth in offtake. Volume mix was better on higher e-auction volumes (23mt v/s estimate of 21mt); the revenue miss was on a

30/11/2017 2:48:12 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Larsen & Toubro Ltd For Target Rs.1337.00 - Kotak Sec

L&T reported mixed set of numbers. While revenue growth was tepid, there was surprise gains on the margin front, which beat our PAT estimates by a wide margins. However, order intake came in lower than estimates due to continued deferment of major orders in the domestic market. The company had to revise sharply downwards its order intake guidance for FY18. There was also some deterioration

30/11/2017 2:42:23 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate DCM Shriram Ltd For Target Rs.652.00 - Emkay

* Chemical revenue at Rs4.8bn (+30% yoy) was driven by 24% yoy increase in Chlor-alkali volume and 28% higher realization. Consequently, EBIT margin expanded by 1760bps yoy (1000bps qoq) to 37%, which is the highest ever quarterly margin.

* Sugar revenue rose by 30% yoy to Rs5.1bn, led by 35% yoy volume growth at 1.32mn quintals. Sugar EBIT rose by 18% yoy to Rs741mn while EBIT margin

30/11/2017 2:35:29 PM | Posted in Broking Firm Views - Long Term Report read full news