Grasim industries reported steady earnings print with strong improvement in standalone earnings (VSF, chemicals) partially offset by weakness seen in cement operations (due to weak realisations).
We continue to believe in the value of its franchise and find the stock attractive at these levels.
Growth could slow down in FY19; ‘Sell’ rating stays on expensive valuations; TP up to `24,000 due to rollover to March, 2020.
LPC’s Q3Fy18 revenues were in line with our estimates, with the US showing stable signs. However, gross margins contracted 240 bps further , leading to a ~5% Ebitda miss (adjusting for forex loss) and 18% PAT miss, despite tight cost control.
The company expects to achieve double-digit Ebitda margin in Q4FY18, which appears difficult due to rise in commodity prices and increase in marketing expenditure. Maintain Sell on expensive valuations; target price revised to Rs 410 (from Rs 400) on rollover to March 2020e.
Sales from luxury/super-luxury projects contributed more, reflecting in high blended realisations of Rs 8,045 /sq. ft. Two projects were launched during the quarter, one of which was added in 3QFY18.
Hindalco’s bid to acquire Aleris Corp (as per unauthenticated media reports) indicates its preference to invest in the downstream value-added rolled product business given poor returns in the upstream aluminum smelting operations.
We expect Zee to deliver strong 20%+ organic growth in domestic ad revenues in 2H led by an improving ad environment and viewership share gains of Zee TV.
The overall deposits in banks grew 11% year-on-year (y-o-y) in FY17, driven largely by current account and savings deposits after demonetisation.
Most players remained strong except Max Life and ICICI Prudential Life, both up just about 10% — we don’t read much into this moderation. Private players’ broad focus on agency expansion remained through bancassurance and it has gained share for large players in the last quarter.
All-India cement prices increased by Rs 4/bag m-o-m in December 2017 led by increases in the North (+ Rs 16/bag m-o-m) as companies attempt to offset cost increase post pet-coke usage ban in three states.
Coal India reported 5 % y-o-y growth in dispatches for November 2017, lower than the 12% y-o-y growth reported in October 2017.
It could lead to superior yield management; capacity addition in Q4FY18 is likely to revive volume growth
The market is ignoring commercial risks to the biosimilar franchise, especially competition; valuations are stretched
Dacogen is the second key oncology injectable approval for Cipla, with Melphalan already launched through partner Par, and along with last week’s approval of Pulmicort Respules, the approval demonstrates Cipla’s capabilities in sterile products, particularly, lyophilised products and suspensions requiring particle size characterisation.
Sell Drop in generation cost aids earnings outperformance A drop in the cost of generation at Sasan and Rosa allowed for RPWR to report net income of Rs 2.7 bn, significantly ahead of estimates.
SUNP’s US base faces challenges given lack of meaningful launches, material price erosion across portfolio and its inability to compete on market share.
CEAT reported 2QFY18 standalone EBITDA of Rs 1.8 billion (down 2% y-o-y), which was 15% ahead of our estimates due to strong recovery in gross margin.
While the improvement in realisations is encouraging, we are unsure if the same is sustainable as capacity utilisations remain low and costs are on the rise.
Cera reported 18% growth sequentially, better than our estimates as it was able to recover some pent-up demand from a weak Q1.
Weaker-than-expected 3QCY17 performance and GST-led disruption in 2Q led to a relatively muted 9MCY17 (broadly representative of CY2017 as 4Q is a seasonally weak quarter).
Torrent Pharmaceuticals (TRP’s) 2QFY18 results missed estimates, and we continue to expect FY2018 to remain a wash-out given the pressures in the US business.
JSW Steel’s EBITDA increased 16 % q-o-q to Rs 30.4 bn, in line with estimates. Steel volumes increased 12% q-o-q led by higher export sales and increased retail sales from steadier markets post GST.
Dabur’s 2QFY18 earnings print was on expected lines. Noise element in the numbers aside, there were a couple of positives that did stand out – superlative growth and market share gains in oral care being the key one.
Sharp slowdown in core service EBITDA growth trajectory was the key highlight of what was a disappointing earnings print.
NIM was stable q-o-q at 4.2% while loan growth, off a high base, slowed to 21% y-o-y. Cost-income ratio deteriorated ~300bps q-o-q to ~60% partly led by infrastructure expansion.
We expect Bajaj Finance to deliver 3.3-3.6% RoA and about 20% RoE over FY2018-20E period. The company will likely deliver 32% EPS CAGR over FY2017-20E on the back of 38% loan book growth, said Kotak.