11 July, 2014 05:24 IST
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Analysts` take on key Q3 earnings last week
Source: IRIS (08-FEB-13)
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We have collated views of analysts on Q3 earnings performance and future outlook for key corporates. The same is as follows:

Hindalco

Bhavesh Chauhan, sr. research analyst, Angel Broking: Hindalco's top-line and bottom-line were below our expectations. Its net sales grew by 3.0% yoy to Rs 67.9 billion. However, EBITDA was down 18.6% yoy to Rs 5.82 billion mainly due to higher input costs. Other income grew by 93.2% yoy to Rs 1.74 billion and there were exceptional items of Rs 1.44 billion during the quarter. Excluding exceptional items, PAT declined 35.8% yoy to Rs 2.89 billion, while we were expecting PAT of Rs 4.04 billion. We maintain our `Neutral` rating on the stock.

Sun Pharmaceutical Industries

Sarabjit Kour Nangra, VP-Research, Pharma, Angel Broking: Sun Pharmaceuticals numbers were well ahead of expectations both on the top and bottom-line front. Net sales and profits came in at Rs 28.52 billion and Rs 8.81 billion, registering a growth of 33.0% and 31.9% respectively. While the top line growth came in on back of the exports which grew by 43.0%. Further the OPM''s came ahead of the expectations at 44.2%. This aided the net profit growth to come in much higher than expectations. We recommend a 'Neutral' on the stock.

ACC

Mihir Jhaveri, Prateek Kumar, Religare Research: ACC posted sub-par Q4CY12 results, disappointing yet again on the operational front. While revenues were in line with estimates, the EBITDA/t fell short at Rs 547 (vs. RCMLe Rs 634), dropping Rs 107 YoY/ Rs 260 QoQ. We trim our CY13/CY14 estimates by 8%/3% and roll over to a Mar''14 PT of Rs 1,400 (vs. Rs 1,530 earlier) based on 8x EV/EBITDA 1-year forward (earlier 9x). We continue to prefer UTCEM/ACEM in the large-cap cement space due to their better profitability and higher upsides. Maintain `Hold`.

Ambuja Cements

Rajesh Kumar, analyst, Karvy Stock Broking: Ambuja's cement sales volume growth of 9% QoQ (-7% YoY) was below our expectations of +15% QoQ growth. This alongwith QoQ surge in all operating cost items (on per MT basis) dragged down EBITDA per MT 28% QoQ down to Rs 876 (10% below our est of Rs 970 per MT). However, net realization decline at 2% QoQ is lower than the industry's realisation decline of 3-5% QoQ. Ambuja's freight & fixed costs surged much ahead of the volume growth which impacted the profitability both on QoQ as well as YoY basis. However, the surge in fixed costs could partly be attributed the yearend adjustments and higher sales promotional expenses during the last quarter of the financial year. We expect these costs to moderate on a sequential basis. However, freight expenses would remain firm due to the impact of diesel price hike resulting in higher road as well as rail transportation costs going forward.

Tech Mahindra

Abhishek Shindadkar and Aishwariya KPL, analysts, ICICIdirect: Tech Mahindra (TechM) reported Q3FY13 earnings, which were generally ahead of our estimates. Q3 revenues increased 10% sequentially to USD 329 million vs. USD 299.2 million in Q2 and were ahead of our USD 317.5 million estimate. Further, we are modelling revenue, EPS CAGR of 12.2%, 8.8%, respectively, during FY12-15E. We continue to value TechM at Rs 1,150 i.e. at 11.1x our CY14E EPS estimate of Rs 104.1 and maintain our `Buy` rating.

Cipla

Rahul Sharma, analysts, Karvy Stock Broking: Cipla's revenues increased by 17.8% YoY to Rs 20,705 million in Q3FY13, as against our estimates of Rs. 20,131 million. Operating margins increased on account of lower material cost to 23.8% in Q3FY13 but was lower than expectation. Net profit has shown growth of 23.5%YoY at Rs 3388 million in Q3FY13. We downgrade the stock to `Hold` with a target price of Rs 426.

Kingfisher Airlines

Rashesh Shah, analyst, ICICIdirect: Kingfisher Airlines (KFA) reported a loss of Rs 7.55 billion (loss before tax of Rs 11.16 billion) due to a complete shutdown of its operation led by suspension of its licence and incurring of one-time cost of Rs 2.75 billion related to restructuring and re-delivery of aircraft. Hence, we continue to keep the stock unrated unless we see some strong action by the management on this front.

Cadila Healthcare

Sarabjit Kour Nangra, VP-research, Angel Broking: Cadila came out with results below expectations. While the sales growth at 15.4% came in in-line with expectations, the bottom-line growth was below expectation, as the OPM's contracted by 349 bps to end the quarter at 13.6%, which lead the net profits to dip by 31.1% during the period. The margins were subdued on back of higher rise in the R&D and other expenditure and contraction in gross margin. We maintain our accumulate rating on the stock.

Apollo Tyres

Kotak Securities: APTY's 3QFY13 consolidated revenues stood at Rs 32,173 million, flat YoY and in line with our expectation. Higher other income and lower than expected tax provision led to net profit of Rs 1,806 million and that was higher than our and street expectation. Volumes across geographies continue to stay under pressure but softness in natural rubber prices is aiding margin improvement. Company is yet to take any decision on the QIP issue. We have marginally changed our FY13 and FY14 estimates. We continue to rate the stock `Accumulate` with price target of Rs94 (earlier Rs95).

Bank of Baroda

Kotak Securities: NII grew moderately at 7.0% YoY during Q3FY13 on back of sharp NIM contraction while loan book saw moderate growth. Net income declined 21.6% YoY on back of lower trading gains along with spike in credit costs. Although the stark asset quality variance relative to its peers may not hold up, we do not foresee BoB's delinquency to converse to the industry mean. Hence, we maintain `Accumulate` rating on the stock with the revised TP of Rs.835 (Rs.860 earlier) based on 1.1x its FY14E ABV.

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.


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