Accumulate Dynamatic Technologies Ltd For Target Rs.2,613.00 - Emkay

GST implementation mars performance

Result highlights

* Dynamatic Technologies (DYTC) has reported lower-than-expected operational performance. Revenue declined by 20% yoy. EBIDTAM declined by 530bps yoy and the company reported a loss of Rs95mn.

* The destocking by end customers in the run-up to the GST implementa

5/10/2017 4:02:47 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Strides Shasun Ltd For Target Rs.1,300.00 - Motilal Oswal

Niche approval kicks in

Thesis playing out; reiterate Buy

* The approval for Potassium Citrate Extended Release (PCER) has triggered longawaited approvals for niche molecules for STR, in our view.

* Though investors like STR for its (1) niche ANDA pipeline, (2) strong regulatory compliance, and (3) credible manage

5/10/2017 3:58:52 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Orient Refractories Ltd For Target Rs.183.00 - Emkay

Strong performance on export front; capex to accelerate growth

* At Rs1.41bn, Orient Refractories’ Q1FY18 revenue was marginally below our estimate of Rs1.49bn due to GST transition. Export revenue jumped 20% yoy (Contr. 22% to revenue v/s 20% in Q1FY17) while Domestic business delivered 4% yoy growth.

* EBITDA also missed our estimate

5/10/2017 3:53:56 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Coal India Ltd For Target Rs.316.00 - Motilal Oswal

Dragged by operating leverage

Many concerns still remain; Maintain Buy

* Coal India’s (COAL) 1QFY18 revenue rose 3.4% YoY to INR184b, driven by 3.6% growth in off-take. Average revenue was unchanged YoY, in line with estimates. However, there was a miss at average realization by 1% (-3% YoY) for FSA and by 7% (+1% YoY)

5/10/2017 3:38:24 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Future Lifestyle Fashions Ltd For Target Rs.495.00 - Emkay

Strong SSG drives growth; Maintain BUY

* Revenues ahead of our estimates led by strong SSG – Revenue at Rs 10.3bn, up 29% yoy; EBITDA down 90bps at 8.3%; EBITDA at Rs 853mn, up 16% yoy; Lower interest burden (-25% yoy) boosts APAT by 29% yoy to Rs 235mn

* Central SSG at 31.1%, Brand Factory SSG at 31.2%, while overall FLFL SSG at 29.4%.

5/10/2017 12:29:41 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Larsen and Toubro Ltd For Target Rs.1,380.00 - Motilal Oswal

Strong momentum seen in domestic infrastructure spending

Digitalization a key focus area

* We hosted Mr SN Subrahmanyan, MD and CEO of Larsen & Toubro as part of CEO Track at our 13th Annual Global Investor Conference. Key takeaways from his presentation:

* Strong momentum being witnessed across domestic infras

5/10/2017 12:24:16 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Advanced Enzyme Technologies Ltd For Target Rs.333.00 - Emkay

Underperformance continues; Maintain BUY on favorable outlook

* Advanced Enzyme (ADVENZY) reported disappointing numbers on all the fronts. The company’s revenue stood at Rs802mn (down 17% yoy), significantly below our estimate, dragged by the dismal performance of top account in Human Nutraceuticals segment.

* Barring the Food segment

5/10/2017 12:19:17 PM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Parag Milk Food Ltd For Target Rs.245.00 - Motilal Oswal

Sales in-line; Medium-term target unchanged

* PARAG reported net sales growth of 7.7% YoY (est. of +6%) to INR4.1b in 1QFY18. EBITDA declined 7.7% YoY (est. of -18.7%) to INR294m, while adj. PAT grew 3% YoY (est. of -24.3%) to INR105m. Sales in 1QFY18 were impacted by destocking (majorly in the last 15 days of June), farmer strike in M

5/10/2017 12:14:37 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Bajaj Corp Ltd For Target Rs.448.00 - Reliance Sec

Background & Business

Bajaj Corp is the market leader in domestic light hair oil market. With flagship brand Almond Drops Hair Oil (ADHO), its volume and value market share stands at 58.3% and 61%, respectively. The Company reported weak results in the past few quarters due to slowdown in overall consumer demand and GST roll-out. However, we expec

5/10/2017 11:37:44 AM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Indo Count Industries Ltd For Target Rs.129.00 - Motilal Oswal

Destocking woes lead to a muted quarter

* Results below estimates: ICNT’s revenue declined 12.4% YoY to INR4,318m (est. of INR5,370m) in 1QFY18. EBITDA fell 41% YoY to INR653m (est. of INR1,187m), with the margin contracting 730bp YoY to 15.1% (est. of 22.1%) on account of total raw material cost rising by 250bp (part of which wa

5/10/2017 11:34:12 AM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate MPS Ltd For Target Rs.700.00 - Emkay

Acquisition to drive next leg of growth

* Management continues to work towards Rs4,000mn annual revenue run-rate target by end of FY18E, driven by inorganic and organic growth opportunities.

* Healthy traction in Platform business will propel organic revenue growth; management guides for healthy double-digit growth in Platform business (~22%

5/10/2017 11:30:59 AM | Posted in Broking Firm Views - Long Term Report read full news
Update On IndusInd Bank Ltd - Motilal Oswal

IIB+BAHFIN = Most profitable universal bank

BAFIN: Removes political and regulatory risk; scale benefits to accelerate

After months of speculations, IndusInd Bank (IIB) and Bharat Financial Inclusion (BHAFIN) have announced the signing of an exclusivity agreement to explore the possibility of a merger/partnership. As highli

5/10/2017 11:27:34 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Torrent Pharmaceuticals Ltd For Target Rs.1,385.00 - Reliance Sec

Background & Business

Torrent Pharmaceuticals (TRP) manufactures Active Pharmaceuticals Ingredients (APIs) and formulations products. The Company also develops complex generic drugs with presence across India, Brazil, US and Emerging Markets. Investment Rationale

* Domestic Formulation Biz to Sustain Growth Trajectory: T

5/10/2017 11:23:17 AM | Posted in Broking Firm Views - Long Term Report read full news
Neutral CG Power and Industrial Solutions Ltd For Target Rs.80.00 - Motilal Oswal

Above-estimate op. performance led by Industrial segment

* Standalone operating performance exceeds estimate: Sales rose 12% YoY to INR12.6b (est. of INR11.7b), driven by growth of 19% in Industrial segment and 6.5% YoY in Power segment. EBIDTA grew 5% YoY to INR0.7b (est. of INR0.6), with the margin of 5.2% in line with our estimate o

5/10/2017 11:17:04 AM | Posted in Broking Firm Views - Long Term Report read full news
Hold Sterling Tools Ltd For Target Rs.238.00 - Emkay

Long-term story intact; Maintain HOLD

* Sterling Tools (STL) has reported a mixed performance for Q1FY18, with revenue below expectation, EBITDA and PAT above estimate aided by a better operational performance, a superior product mix and lower interest expenditure.

* GST transition has impacted the revenue growth (4.6% yoy v/s 7% Emkay Est) d

5/10/2017 11:08:18 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Bharat Electronics Ltd For Target Rs.215.00 - Motilal Oswal

Capex of INR25b to capture future growth opportunities

Plans to expand through diversification; R&D remains key focus area

 

Capex plans of INR25b over next 3-4 years

BHE plans to spend INR25b over the next 3-4 years (INR5b-6b annually) on modernization of its fac

5/10/2017 11:02:03 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sheela Foam Ltd For Target Rs.1,752.00 - Emkay

The night is still young; Initiate at BUY

Sleepwell: A sparkling future

* Initiate BUY on this under-researched name, TP Rs1,752, based on DCF valuation. Promoted by Gautam family, SFL’s Sleepwell brand dominates India’s branded mattress market with 23% share.

* A 64% of the Indian mattress market is fr

4/10/2017 11:33:41 AM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Ipca Laboratories Ltd For Target Rs.430.00 - Motilal Oswal

Weak quarter; recovery expected in coming quarters

* Revenue declined 15.3% YoY (est. of -7%) to INR7.1b. EBITDA declined significantly by 83% YoY to INR215m, as the company posted one of the lowest EBITDA margin in the last 7-8 quarters of 3%. The miss in revenue and margin is primarily attributed to GST impact on the domestic business. Weak operatin

4/10/2017 11:26:47 AM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Sun TV Network Ltd For Target Rs.990.00 - Emkay

Aggressive IPL bidding; Value accretive

* Star India has won IPL rights including India broadcast, India digital and the rest of the world broadcast and digital for Rs163bn with total 5 year tenure (2018-2022).

* As per our calculations, IPL teams will get Rs1163mn incremental revenues with higher value of rights. Adding impact of VIVO’

4/10/2017 11:22:22 AM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Dr Reddys Laboratories Ltd For Target Rs.2,400.00 - Motilal Oswal

German regulator issues observations at Duvvada facility

No supplies to EU from this facility; hence, no revenue impact

The German regulator conducted an audit on DRRD’s Duvvada-based Oncology injectable formulations facility. The regulator has issued six major observations post inspection of this facility. DRRD will

4/10/2017 11:18:17 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Shankara Building Products Ltd For Target Rs.1,497.00 - Emkay

Compelling play on home improvement

* Shankara Building Products (Shankara) is a good proxy to play on the growing demand for organized home improvement and building material store. Proliferation of brands, increased involvement of end-customer in purchase and preference for convenience will result demand for a large organized retailer in building mate

4/10/2017 11:11:34 AM | Posted in Broking Firm Views - Long Term Report read full news
Buy Birla Corporation Ltd For Target Rs.1,150.00 - Motilal Oswal

In line performance in both standalone and consolidated operations

* Muted volume growth for standalone: Standalone volumes fell 1% YoY to 2.14mt (est. of 2.20mt) due to weak demand in U.P on account of shortage of sand. Reliance cement reported volume of 1.14mt for 1QFY18 operating at ~81% utilization vs 67% utilization for FY17. Sta

4/10/2017 11:00:35 AM | Posted in Broking Firm Views - Long Term Report read full news
Update On Ramco Systems Ltd - Emkay

IP repository on verge of monetization

* Ramco Systems (RMCS) management remains confident about sustaining the business momentum in its identified focus verticals of Logistics and Aviation and horizontal offerings in HCM and Next-gen Financials.

* Traction is evident from a strong deal traction, with the addition of ~US$100mn in new TCV in t

4/10/2017 10:56:01 AM | Posted in Broking Firm Views - Long Term Report read full news
Neutral Energy Efficiency Services Ltd For Target Rs.455.00 - Motilal Oswal

Portfolio expansion in Lighting segment a key highlight

* Product portfolio expansion in lighting segment: EESL has placed orders worth INR17.2b during April-July 2017, up 228% YoY. A key highlight of YTD FY17 ordering is expansion of product portfolio in the lighting segment (street lights, industrial lamps, solar study lamps and lumi

4/10/2017 10:49:13 AM | Posted in Broking Firm Views - Long Term Report read full news
Hold DLF Ltd For Target Rs.187.00 - Emkay

DCCDL deal done, DLF’s debt to halve

Event highlights

* GIC will acquire 33.3% equity stake from DLF’s promoters in DLF Cyber City Developers (DCCDL). The deal has been undertaken at an EV of Rs356bn vs. estimated FY18E DCCDL EBITDA of Rs26bn which implies a cap rate of 7.3%.

* Adjusted for DCCDL net de

4/10/2017 10:37:55 AM | Posted in Broking Firm Views - Long Term Report read full news