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MARKET WIZARD NEWSLETTER ISSUE 10.pdf
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MARKET WIZARD NEWSLETTER ISSUE 10
Fundamental Stocks
▶️The Jammu & Kashmir Bank Ltd
▶️Mangalam Cement Ltd
▶️Sanofi India Ltd
▶️HSIL Ltd
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▶️The Anup Engineering Ltd
▶️Equitas Holdings Ltd
▶️Glaxosmithkline Pharmaceuticals Ltd
▶️Narayana Hrudayalaya Ltd
▶️Shalimar Paints Ltd (Special Pick)
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Fundamental Stocks
▶️The Jammu & Kashmir Bank Ltd
▶️Mangalam Cement Ltd
▶️Sanofi India Ltd
▶️HSIL Ltd
Technical Stocks
▶️The Anup Engineering Ltd
▶️Equitas Holdings Ltd
▶️Glaxosmithkline Pharmaceuticals Ltd
▶️Narayana Hrudayalaya Ltd
▶️Shalimar Paints Ltd (Special Pick)
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*Cipla – Q4FY21 Concall Update – Nirmal Bang Sec.*
*Outlook – Positive*
The management sounded confident of sustaining and improving margins going forward. India business would see uptick from ramp up in Covid drugs whereas US is likely to grow on account of new launches
The stock is trading at 26.4xFY22E our earnings
• For full year the margins range has moved from historical 16-19% to 22% in FY22 and which, per management, is sustainable and likely to get improved hereon
• Gross margins were 60% - had ~200 bps impact due to inventory writeoff and certain overhead charge offs and one time sale adjustment for Albuterol. also due to product mix and seasonality, margins are lower in Q4; there is no structural changes in the business
• R&D – Rs 277 cr – as percent of sales, it is likely to moderate going forward
• On full year basis, Covid medicine contributes ~4% of total revenues
• *Going forward*
o Ramping up Covid portfolio supply to increase availability and maximize patients reach
o Scaling up businesses across branded and generic DTMs of Europe and Emerging markets through execution on organic and partnered launches including biosimilars
o Expanding lung leadership globally and maximising value opportunity in US complex generics by prioritizing key launches with focused execution and collaborating with regulatory authorities
o Maintain market beating growth in large branded and unbranded generic franchises of India, South Africa and augment consumer wellness franchise
*India*
• Healthy volume trends emerging in core portfolio
• Witnessing strong volume trends across acute and respiratory portfolio
• Trade generics business - Healthy order flow across regions during the quarter; Strong demand tailwinds emerging across portfolio
• Consumer Health Biz – Rs 360 cr rev in FY21 - Continued traction in consumer brands post transfer from trade generics business;
• *Witnessing strong tailwinds which are likely to play out in Q1 and onwards* on back of surge in Covid drugs, including Remdesivir and expected pick up in the antibody cocktail
*US Generics*
• $138 mn Q4 rev; FY21 $551 mn
• Had one time shelf stock adjustments for Albuterol due to entry of a competitor
• Continued market share expansion in overall Albuterol market and growth in institutional business - *see some more expansion in Albuterol going forward* - currently has 16.5% market share
• US’s full year profitability is very close to company level profitability
• Closely working with USFDA on gAdvair –would take 2-2.5 yrs for approval from the filed date which was May’20
• 2 Partnered peptide injectable filings during in FY21; includes one new drug application
• Full year FY21 EBITDA margins tracking close to overall company level
• *Reasonable launches in FY22 to drive the growth in US however big launches in FY23*
• Paclitaxel is likely to launch in next few months and Lanthanum Carbonate is likely to get launched in 2HFY23
*SAGA*
• South Africa - Solid momentum in private business; tender business in-line with expectations
*Other markets*
• _Emerging markets_ - Continued healthy demand across all regions; Expanded partnership for 4 biosimilars in Australia & New Zealand
• _Europe_ - grew 7% yoy in Q4, Front-end market entry into Spain
• _API_ - Continued traction with global seedings & lock-ins
*Outlook – Positive*
The management sounded confident of sustaining and improving margins going forward. India business would see uptick from ramp up in Covid drugs whereas US is likely to grow on account of new launches
The stock is trading at 26.4xFY22E our earnings
• For full year the margins range has moved from historical 16-19% to 22% in FY22 and which, per management, is sustainable and likely to get improved hereon
• Gross margins were 60% - had ~200 bps impact due to inventory writeoff and certain overhead charge offs and one time sale adjustment for Albuterol. also due to product mix and seasonality, margins are lower in Q4; there is no structural changes in the business
• R&D – Rs 277 cr – as percent of sales, it is likely to moderate going forward
• On full year basis, Covid medicine contributes ~4% of total revenues
• *Going forward*
o Ramping up Covid portfolio supply to increase availability and maximize patients reach
o Scaling up businesses across branded and generic DTMs of Europe and Emerging markets through execution on organic and partnered launches including biosimilars
o Expanding lung leadership globally and maximising value opportunity in US complex generics by prioritizing key launches with focused execution and collaborating with regulatory authorities
o Maintain market beating growth in large branded and unbranded generic franchises of India, South Africa and augment consumer wellness franchise
*India*
• Healthy volume trends emerging in core portfolio
• Witnessing strong volume trends across acute and respiratory portfolio
• Trade generics business - Healthy order flow across regions during the quarter; Strong demand tailwinds emerging across portfolio
• Consumer Health Biz – Rs 360 cr rev in FY21 - Continued traction in consumer brands post transfer from trade generics business;
• *Witnessing strong tailwinds which are likely to play out in Q1 and onwards* on back of surge in Covid drugs, including Remdesivir and expected pick up in the antibody cocktail
*US Generics*
• $138 mn Q4 rev; FY21 $551 mn
• Had one time shelf stock adjustments for Albuterol due to entry of a competitor
• Continued market share expansion in overall Albuterol market and growth in institutional business - *see some more expansion in Albuterol going forward* - currently has 16.5% market share
• US’s full year profitability is very close to company level profitability
• Closely working with USFDA on gAdvair –would take 2-2.5 yrs for approval from the filed date which was May’20
• 2 Partnered peptide injectable filings during in FY21; includes one new drug application
• Full year FY21 EBITDA margins tracking close to overall company level
• *Reasonable launches in FY22 to drive the growth in US however big launches in FY23*
• Paclitaxel is likely to launch in next few months and Lanthanum Carbonate is likely to get launched in 2HFY23
*SAGA*
• South Africa - Solid momentum in private business; tender business in-line with expectations
*Other markets*
• _Emerging markets_ - Continued healthy demand across all regions; Expanded partnership for 4 biosimilars in Australia & New Zealand
• _Europe_ - grew 7% yoy in Q4, Front-end market entry into Spain
• _API_ - Continued traction with global seedings & lock-ins
*Dr Reddy – Q4FY21 Concall Update – Nirmal Bang Sec.*
*Outlook – Positive for long term*
_The growth pillars are intact and the company is committed moving towards its aspirational target of 25% EBITDA margins. The jealthy number of launches in US (26-28/yr) and Covid related portfolio in India are likely to drive the growth in near term_
The stock is trading at 27xFY22E consensus earnings
• Launched Sputnik V vaccine today – have rights for 250 mn doses – now to Aug the primary supply would be from Russia and by sept Indian supplies can start
• Revenue growth was supported by new product launches, scale up in wockhardt portfolio, entry in new markets, and improvement in base business volume. However, the sequential decline is due to muted branded business and milestone payment received in Q3
• R&D for Q4 - Rs 409 cr – 8.7% of sales
• ETR for FY21 was at 32.4% which was on the higher side due to non-recognition of deferred tax assets. *ETR for FY22 is expected to be 25-26%*
*North America*
• Revenue of $237mn, a decline of 3% yoy
• The YoY decline was primarily on account of higher volumes during Q4 last year due to COVID-19 related stocking up and price erosion. The QoQ growth was driven by volume traction in the base business and new product launches partly offset by price erosion.
• The year was benefited by new launches, scale up of existing products and a favorable forex rate, which was partially offset by price erosion
• During this quarter, Dr Reddy launched 6 new products – Vigabatrin tablets (CGT status granted), Febuxostat tablets, Capecitabine tablets, Fluphenazine Hydrochloride tablets, Lansoprazole OD tablets and Abiraterone Acetate in Canada.
• For FY21, the company launched 28 new products. *It expects similar number of launches in FY22 as well*
• Copaxone – still working on the recent received CRL
• Unlikely to launch Copaxone and Nuvaring in FY22. Reply submitted to USFDA on Nuvaring in Jan’21. The response is expected by Oct’21
• gKuvan (500 mg) -approval and launch expected in 2HFY22
• gVascepa – expects launch in next couple of months
• gRevlimid – launch is expected in FY23
*Europe*
• Revenue was Eur 45 mn; YoY growth of 15% and QoQ decline of 5%. QoQ decline was on account of lower volumes in the base business and price erosion which was partly offset by new products launched during the quarter.
• Launched 3 products in Germany during the quarter and 40 in FY21
•
*India*
• Rev of Rs 845 cr rev, 22% yoy growth, QoQ decline of 12%. QoQ decline was led by reduction in covid drugs sales and seasonality. Adjusted for contribution from Wockhardt portfolio, revenues grew by 8% yoy in Q4
• Launched 2 new products
*Emerging Markets*
• Revenues for the quarter are Rs. 885 cr, YoY growth of 10%, QoQ decline of 8%
• Launched 31 products in Emerging Markets in Q4
• Business in China did well
*Outlook – Positive for long term*
_The growth pillars are intact and the company is committed moving towards its aspirational target of 25% EBITDA margins. The jealthy number of launches in US (26-28/yr) and Covid related portfolio in India are likely to drive the growth in near term_
The stock is trading at 27xFY22E consensus earnings
• Launched Sputnik V vaccine today – have rights for 250 mn doses – now to Aug the primary supply would be from Russia and by sept Indian supplies can start
• Revenue growth was supported by new product launches, scale up in wockhardt portfolio, entry in new markets, and improvement in base business volume. However, the sequential decline is due to muted branded business and milestone payment received in Q3
• R&D for Q4 - Rs 409 cr – 8.7% of sales
• ETR for FY21 was at 32.4% which was on the higher side due to non-recognition of deferred tax assets. *ETR for FY22 is expected to be 25-26%*
*North America*
• Revenue of $237mn, a decline of 3% yoy
• The YoY decline was primarily on account of higher volumes during Q4 last year due to COVID-19 related stocking up and price erosion. The QoQ growth was driven by volume traction in the base business and new product launches partly offset by price erosion.
• The year was benefited by new launches, scale up of existing products and a favorable forex rate, which was partially offset by price erosion
• During this quarter, Dr Reddy launched 6 new products – Vigabatrin tablets (CGT status granted), Febuxostat tablets, Capecitabine tablets, Fluphenazine Hydrochloride tablets, Lansoprazole OD tablets and Abiraterone Acetate in Canada.
• For FY21, the company launched 28 new products. *It expects similar number of launches in FY22 as well*
• Copaxone – still working on the recent received CRL
• Unlikely to launch Copaxone and Nuvaring in FY22. Reply submitted to USFDA on Nuvaring in Jan’21. The response is expected by Oct’21
• gKuvan (500 mg) -approval and launch expected in 2HFY22
• gVascepa – expects launch in next couple of months
• gRevlimid – launch is expected in FY23
*Europe*
• Revenue was Eur 45 mn; YoY growth of 15% and QoQ decline of 5%. QoQ decline was on account of lower volumes in the base business and price erosion which was partly offset by new products launched during the quarter.
• Launched 3 products in Germany during the quarter and 40 in FY21
•
*India*
• Rev of Rs 845 cr rev, 22% yoy growth, QoQ decline of 12%. QoQ decline was led by reduction in covid drugs sales and seasonality. Adjusted for contribution from Wockhardt portfolio, revenues grew by 8% yoy in Q4
• Launched 2 new products
*Emerging Markets*
• Revenues for the quarter are Rs. 885 cr, YoY growth of 10%, QoQ decline of 8%
• Launched 31 products in Emerging Markets in Q4
• Business in China did well
*Aditya Birla Capital Ltd. - C* | *CMP* Rs. 121 | *M Cap* Rs. 29297 Cr | *52 W H/L* 140/41
(Nirmal Bang Retail Research)
*Result has improved*
_Segment Revenue_
NBFC revenue came at Rs. 1379.4 Cr vs YoY Rs. 1502.3 Cr, QoQ Rs. 1333.2 Cr
Life insurance revenue came at Rs. 3244.3 Cr vs YoY Rs. 2539.4 Cr, QoQ Rs. 2824.8 Cr
Asset Management revenue came at Rs. 331.4 Cr vs YoY Rs. 277.5 Cr, QoQ Rs. 321.1 Cr
General insurance Broking revenue came at Rs. 164.6 Cr vs YoY Rs. 114.9 Cr, QoQ Rs. 185.3 Cr
Money Broking revenue came at Rs. 49.4 Cr vs YoY Rs. 45.7 Cr, QoQ Rs. 49.2 Cr
Health insurance revenue came at Rs. 424.7 Cr vs YoY Rs. 296 Cr, QoQ Rs. 287.5 Cr
Other Financial Services revenue came at Rs. 30 Cr vs YoY Rs. 31.5 Cr, QoQ Rs. 36 Cr
Total Income came at Rs. 5929.2 Cr vs YoY Rs. 5138.1 Cr, QoQ Rs. 5362.8 Cr
PBT came at Rs. 500.4 Cr vs YoY Rs. 138.6 Cr, QoQ Rs. 401.1 Cr
PAT came at Rs. 375.2 Cr vs YoY Rs. 143.7 Cr, QoQ Rs. 288.7 Cr
AMC AUM's came at Rs. 262875 Cr vs YoY Rs. 245677.6 Cr, QoQ Rs. 255458 Cr
AMC market share declined slightly to 9.2% from QoQ 9.35%
Individual Life Insurance market share was constant QoQ at 4.5%
Quarter EPS is Rs. 1.6
Share is trading at P/E of 18.6x FY22E EPS & 2.6x trailing P/BV
(Nirmal Bang Retail Research)
*Result has improved*
_Segment Revenue_
NBFC revenue came at Rs. 1379.4 Cr vs YoY Rs. 1502.3 Cr, QoQ Rs. 1333.2 Cr
Life insurance revenue came at Rs. 3244.3 Cr vs YoY Rs. 2539.4 Cr, QoQ Rs. 2824.8 Cr
Asset Management revenue came at Rs. 331.4 Cr vs YoY Rs. 277.5 Cr, QoQ Rs. 321.1 Cr
General insurance Broking revenue came at Rs. 164.6 Cr vs YoY Rs. 114.9 Cr, QoQ Rs. 185.3 Cr
Money Broking revenue came at Rs. 49.4 Cr vs YoY Rs. 45.7 Cr, QoQ Rs. 49.2 Cr
Health insurance revenue came at Rs. 424.7 Cr vs YoY Rs. 296 Cr, QoQ Rs. 287.5 Cr
Other Financial Services revenue came at Rs. 30 Cr vs YoY Rs. 31.5 Cr, QoQ Rs. 36 Cr
Total Income came at Rs. 5929.2 Cr vs YoY Rs. 5138.1 Cr, QoQ Rs. 5362.8 Cr
PBT came at Rs. 500.4 Cr vs YoY Rs. 138.6 Cr, QoQ Rs. 401.1 Cr
PAT came at Rs. 375.2 Cr vs YoY Rs. 143.7 Cr, QoQ Rs. 288.7 Cr
AMC AUM's came at Rs. 262875 Cr vs YoY Rs. 245677.6 Cr, QoQ Rs. 255458 Cr
AMC market share declined slightly to 9.2% from QoQ 9.35%
Individual Life Insurance market share was constant QoQ at 4.5%
Quarter EPS is Rs. 1.6
Share is trading at P/E of 18.6x FY22E EPS & 2.6x trailing P/BV
*Eris Lifesciences – Q4FY21 Concall Update – Nirmal Bang Sec.*
*Outlook – Positive*
The stock is trading 22.6xFY22E consensus earnings
• Revenues grew by 11.9% to Rs 278 cr
• Launched 2 products in Q4 – Zayo (brand for Sacubitril and Valsartan) and Bricet
• *After a gap of several years, the company launched more than 10 new products, including combinations in FY21. The company is likely to launch 10plus products in FY22 as well*
• Gross margins were lower at 78.3% vs 87.1% in Q4FY20, due to additional costs of new product launches without ramp up yet. Also, due to higher contribution from third party manufacturers, the gross margins were lower. *the management expects improvement in gross margins from Q1FY22 onwards as new products ramp up in scale and as contribution from Gwalior facility increases*
• However, EBITDA margins improved by 290 bps to 34% on the back of 15% increase in MR productivity and pandemic driven cost savings
• The yield per man per month for the standalone operations increased to Rs 4.5 lakhs per month, up from Rs 3.9 lakhs per month in the last year
• FY21 was a game changes for the company; had 5 significant product launches during the year – Gluxit (have exit rate of Rs 2.5/month runrate sales in March’21), Zac D (combination of Vitamins A, C and D), Rivalto, Bricet and Zayo
• *Zomelis*, the Vildagliptin brand acquired in December 2019, has grown by nearly 4.5x in sales run rate since acquisition. Its market share has increased from 7.3% in Dec’19 to 10.9% in March’21. It has an exit sales run rate of Rs 4.4 cr/month in March. It is still in growth phase anad *likely to do Rs 50 cr+ sales in FY22*
• *Going Forward* - (a) have a rich pipeline of new product launches, driven by upcoming patent expirations in the Cardio Metabolic and allied segments (b) expanding coverage of cardiologists and consulting physicians by up to 50% in the next two years
• Number of MRs have come down to 2036 from 2345 due to closing of one of the divisions IVS
• *Guidance* - 15% growth in both topline and bottomline
• *Per management, due to high usage of Steroids during the treatment of Covid, the onset age of diabetics (which is currently 42.5 yrs) can prepone as much as 5 yrs, so India as a country is on the verge of massive surge in diabetes cases, which would be beneficial for chronic players like Eris*
• * April month’s growth over march was extremely good*
• Not looking for any major capex for next 3-4 yrs
• ReNerve – the flagship band acquired among Strides’ portfolio – has grown at a CAGR of 17% since acquisition and is close to Rs 135-140 cr per annum.
• The company has around Rs 400 cr cash – which they like to maintain for future inorganic opportunities
*Outlook – Positive*
The stock is trading 22.6xFY22E consensus earnings
• Revenues grew by 11.9% to Rs 278 cr
• Launched 2 products in Q4 – Zayo (brand for Sacubitril and Valsartan) and Bricet
• *After a gap of several years, the company launched more than 10 new products, including combinations in FY21. The company is likely to launch 10plus products in FY22 as well*
• Gross margins were lower at 78.3% vs 87.1% in Q4FY20, due to additional costs of new product launches without ramp up yet. Also, due to higher contribution from third party manufacturers, the gross margins were lower. *the management expects improvement in gross margins from Q1FY22 onwards as new products ramp up in scale and as contribution from Gwalior facility increases*
• However, EBITDA margins improved by 290 bps to 34% on the back of 15% increase in MR productivity and pandemic driven cost savings
• The yield per man per month for the standalone operations increased to Rs 4.5 lakhs per month, up from Rs 3.9 lakhs per month in the last year
• FY21 was a game changes for the company; had 5 significant product launches during the year – Gluxit (have exit rate of Rs 2.5/month runrate sales in March’21), Zac D (combination of Vitamins A, C and D), Rivalto, Bricet and Zayo
• *Zomelis*, the Vildagliptin brand acquired in December 2019, has grown by nearly 4.5x in sales run rate since acquisition. Its market share has increased from 7.3% in Dec’19 to 10.9% in March’21. It has an exit sales run rate of Rs 4.4 cr/month in March. It is still in growth phase anad *likely to do Rs 50 cr+ sales in FY22*
• *Going Forward* - (a) have a rich pipeline of new product launches, driven by upcoming patent expirations in the Cardio Metabolic and allied segments (b) expanding coverage of cardiologists and consulting physicians by up to 50% in the next two years
• Number of MRs have come down to 2036 from 2345 due to closing of one of the divisions IVS
• *Guidance* - 15% growth in both topline and bottomline
• *Per management, due to high usage of Steroids during the treatment of Covid, the onset age of diabetics (which is currently 42.5 yrs) can prepone as much as 5 yrs, so India as a country is on the verge of massive surge in diabetes cases, which would be beneficial for chronic players like Eris*
• * April month’s growth over march was extremely good*
• Not looking for any major capex for next 3-4 yrs
• ReNerve – the flagship band acquired among Strides’ portfolio – has grown at a CAGR of 17% since acquisition and is close to Rs 135-140 cr per annum.
• The company has around Rs 400 cr cash – which they like to maintain for future inorganic opportunities
*Quick Heal Technologies Ltd.* | *CMP* Rs. 189 | *M Cap* Rs. 1214 Cr | *52 W H/L* 216/98
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 105.3 Cr (50.7% QoQ, 63.9% YoY) vs QoQ Rs. 69.9 Cr, YoY Rs. 64.3 Cr
EBIDTA came at Rs. 53.8 Cr (226.6% QoQ, 608.8% YoY) vs QoQ Rs. 16.5 Cr, YoY Rs. 7.6 Cr
EBITDA Margin came at 51.1% vs QoQ 23.6%, YoY 11.8%
Adj. PAT came at Rs. 39.7 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8 Cr
Quarter EPS is Rs. 6.2
Share is trading at P/E of 11.3x TTM EPS
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 105.3 Cr (50.7% QoQ, 63.9% YoY) vs QoQ Rs. 69.9 Cr, YoY Rs. 64.3 Cr
EBIDTA came at Rs. 53.8 Cr (226.6% QoQ, 608.8% YoY) vs QoQ Rs. 16.5 Cr, YoY Rs. 7.6 Cr
EBITDA Margin came at 51.1% vs QoQ 23.6%, YoY 11.8%
Adj. PAT came at Rs. 39.7 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8 Cr
Quarter EPS is Rs. 6.2
Share is trading at P/E of 11.3x TTM EPS
*AYM Syntex Ltd.* | *CMP* Rs. 53 | *M Cap* Rs. 263 Cr | *52 W H/L* 61/14
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 349.7 Cr (18.9% QoQ, 42.5% YoY) vs QoQ Rs. 294.2 Cr, YoY Rs. 245.4 Cr
EBIDTA came at Rs. 41.9 Cr (19.9% QoQ, 79% YoY) vs QoQ Rs. 34.9 Cr, YoY Rs. 23.4 Cr
EBITDA Margin came at 12% vs QoQ 11.9%, YoY 9.5%
Adj. PAT came at Rs. 18.8 Cr vs QoQ Rs. 10.8 Cr, YoY Rs. 8.9 Cr
Quarter EPS is Rs. 3.8
Share is trading at P/E of 18.6x TTM EPS
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 349.7 Cr (18.9% QoQ, 42.5% YoY) vs QoQ Rs. 294.2 Cr, YoY Rs. 245.4 Cr
EBIDTA came at Rs. 41.9 Cr (19.9% QoQ, 79% YoY) vs QoQ Rs. 34.9 Cr, YoY Rs. 23.4 Cr
EBITDA Margin came at 12% vs QoQ 11.9%, YoY 9.5%
Adj. PAT came at Rs. 18.8 Cr vs QoQ Rs. 10.8 Cr, YoY Rs. 8.9 Cr
Quarter EPS is Rs. 3.8
Share is trading at P/E of 18.6x TTM EPS
*Quick Heal Technologies Ltd.* | *CMP* Rs. 189 | *M Cap* Rs. 1214 Cr | *52 W H/L* 216/98
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 105.3 Cr (50.7% QoQ, 63.9% YoY) vs QoQ Rs. 69.9 Cr, YoY Rs. 64.3 Cr
EBIDTA came at Rs. 53.8 Cr (226.6% QoQ, 608.8% YoY) vs QoQ Rs. 16.5 Cr, YoY Rs. 7.6 Cr
EBITDA Margin came at 51.1% vs QoQ 23.6%, YoY 11.8%
Adj. PAT came at Rs. 39.7 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8 Cr
Quarter EPS is Rs. 6.2
Share is trading at P/E of 11.3x TTM EPS
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 105.3 Cr (50.7% QoQ, 63.9% YoY) vs QoQ Rs. 69.9 Cr, YoY Rs. 64.3 Cr
EBIDTA came at Rs. 53.8 Cr (226.6% QoQ, 608.8% YoY) vs QoQ Rs. 16.5 Cr, YoY Rs. 7.6 Cr
EBITDA Margin came at 51.1% vs QoQ 23.6%, YoY 11.8%
Adj. PAT came at Rs. 39.7 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8 Cr
Quarter EPS is Rs. 6.2
Share is trading at P/E of 11.3x TTM EPS
*DCM Nouvelle Ltd.* | *CMP* Rs. 99 | *M Cap* Rs. 185 Cr | *52 W H/L* 99/19
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 186.9 Cr (22.7% QoQ, 33% YoY) vs QoQ Rs. 152.4 Cr, YoY Rs. 140.5 Cr
EBIDTA came at Rs. 36.7 Cr (78.9% QoQ, 235.1% YoY) vs QoQ Rs. 20.5 Cr, YoY Rs. 11 Cr
EBITDA Margin came at 19.6% vs QoQ 13.5%, YoY 7.8%
Adj. PAT came at Rs. 24.5 Cr vs QoQ Rs. 12.3 Cr, YoY Rs. 1.7 Cr
Quarter EPS is Rs. 13.1
Share is trading at P/E of 6.1x TTM EPS
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 186.9 Cr (22.7% QoQ, 33% YoY) vs QoQ Rs. 152.4 Cr, YoY Rs. 140.5 Cr
EBIDTA came at Rs. 36.7 Cr (78.9% QoQ, 235.1% YoY) vs QoQ Rs. 20.5 Cr, YoY Rs. 11 Cr
EBITDA Margin came at 19.6% vs QoQ 13.5%, YoY 7.8%
Adj. PAT came at Rs. 24.5 Cr vs QoQ Rs. 12.3 Cr, YoY Rs. 1.7 Cr
Quarter EPS is Rs. 13.1
Share is trading at P/E of 6.1x TTM EPS
*Cheviot Company Ltd.* | *CMP* Rs. 800 | *M Cap* Rs. 517 Cr | *52 W H/L* 820/500
(Nirmal Bang Retail Research)
*Result improved* *Company declared Special dividend of Rs.175/share*
Revenue from Operations came at Rs. 156.9 Cr (31.3% QoQ, 36.7% YoY) vs QoQ Rs. 119.5 Cr, YoY Rs. 114.8 Cr
EBIDTA came at Rs. 24.6 Cr (68.9% QoQ, 68.9% YoY) vs QoQ Rs. 14.6 Cr, YoY Rs. 14.6 Cr
EBITDA Margin came at 15.7% vs QoQ 12.2%, YoY 12.7%
Adj. PAT came at Rs. 25.7 Cr vs QoQ Rs. 23.3 Cr, YoY Rs. 3.5 Cr
Quarter EPS is Rs. 39.7
Share is trading at P/E of 6.8x TTM EPS
(Nirmal Bang Retail Research)
*Result improved* *Company declared Special dividend of Rs.175/share*
Revenue from Operations came at Rs. 156.9 Cr (31.3% QoQ, 36.7% YoY) vs QoQ Rs. 119.5 Cr, YoY Rs. 114.8 Cr
EBIDTA came at Rs. 24.6 Cr (68.9% QoQ, 68.9% YoY) vs QoQ Rs. 14.6 Cr, YoY Rs. 14.6 Cr
EBITDA Margin came at 15.7% vs QoQ 12.2%, YoY 12.7%
Adj. PAT came at Rs. 25.7 Cr vs QoQ Rs. 23.3 Cr, YoY Rs. 3.5 Cr
Quarter EPS is Rs. 39.7
Share is trading at P/E of 6.8x TTM EPS
*MANGALORE CHEMICALS & FERTILIZERS LTD.* | *CMP* Rs. 96 | *M Cap* Rs. 1138 Cr | *52 W H/L* 96/27
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 598.4 Cr (83% QoQ, 6.3% YoY) vs QoQ Rs. 327.1 Cr, YoY Rs. 563.2 Cr
EBIDTA came at Rs. 46.9 Cr (100.6% QoQ, 56.5% YoY) vs QoQ Rs. 23.4 Cr, YoY Rs. 30 Cr
EBITDA Margin came at 7.8% vs QoQ 7.1%, YoY 5.3%
Adj. PAT came at Rs. 14.7 Cr vs QoQ Rs. 0.8 Cr, YoY Rs. 23.9 Cr
Quarter EPS is Rs. 1.2
Share is trading at P/E of 17x TTM EPS
(Nirmal Bang Retail Research)
*Result improved*
Revenue from Operations came at Rs. 598.4 Cr (83% QoQ, 6.3% YoY) vs QoQ Rs. 327.1 Cr, YoY Rs. 563.2 Cr
EBIDTA came at Rs. 46.9 Cr (100.6% QoQ, 56.5% YoY) vs QoQ Rs. 23.4 Cr, YoY Rs. 30 Cr
EBITDA Margin came at 7.8% vs QoQ 7.1%, YoY 5.3%
Adj. PAT came at Rs. 14.7 Cr vs QoQ Rs. 0.8 Cr, YoY Rs. 23.9 Cr
Quarter EPS is Rs. 1.2
Share is trading at P/E of 17x TTM EPS
Balkrishna Industries Q4FY21 Concall Update
(Nirmal Bang Retail Research)
*High capex towards modernization and expansion in carbon black to weigh down on return ratios in near term*
Outlook: Positive
• Co has guided for sale of 250-260k tons in FY22.
• Capex for FY22 will be at Rs. 800-850 Cr.
• Project for ultra large tyres at Bhuj has completed and is in the final trial phase.
• Co is running at full capacity in carbon black on existing capacity at 115k tons.
• Carbon Black plant’s capacity has now increased to 140k tons and sales to 3rd parties has started.
• The greenfeld plant at Waluj for replacement tyres with 30k tons capacity saw a temporary shutdown in March but commenced again in April and now is expected to be completed in Sep’21.
• The company has long-term margin estimates of 28-30%
• The company had prices hikes of around 3-4% in Jan’21 and Apr’21
• The company had witnessed a raw material price increase of 2-3% and expects it to be around 5-6% in the coming quarters
Break up of Rs. 1900 Cr capex plan
Most of the capex will be funded through internal accruals and some debt will be taken.
1) Rs. 800 Cr towards debottlenecking and brownfield expansion of tyre plant at Bhuj. Expansion to add 50k tons capacity by mid FY23. This will increase total tyre capacity to 335k tons over next 4 years.
2) Rs. 650 Cr will be spent by H1FY23 towards carbon black capacity increase from 140k to 200k tons incl. 30k tons of advanced carbon material for 3rd party sale. This will lead to full in-house carbon black sourcing by the company. Between 25-30% of total capacity will be available for 3rd party sales. Profitability here will be lower than co margins and will be at 15-16% and thus will be ROCE dilutive. Payback period will be 5-6 years.
3) Rs. 450 Cr will be spent for modernization & automation and material handling systems at Bhuj and Rajasthan by H1FY23. This modernization drive happens once every 7-8 years. Payback period will be 5 years. This will drive margins higher in the long run although in the short run shall impact asset turns and ROCE.
Share is trading at P/E of 28.9x FY22E EPS
(Nirmal Bang Retail Research)
*High capex towards modernization and expansion in carbon black to weigh down on return ratios in near term*
Outlook: Positive
• Co has guided for sale of 250-260k tons in FY22.
• Capex for FY22 will be at Rs. 800-850 Cr.
• Project for ultra large tyres at Bhuj has completed and is in the final trial phase.
• Co is running at full capacity in carbon black on existing capacity at 115k tons.
• Carbon Black plant’s capacity has now increased to 140k tons and sales to 3rd parties has started.
• The greenfeld plant at Waluj for replacement tyres with 30k tons capacity saw a temporary shutdown in March but commenced again in April and now is expected to be completed in Sep’21.
• The company has long-term margin estimates of 28-30%
• The company had prices hikes of around 3-4% in Jan’21 and Apr’21
• The company had witnessed a raw material price increase of 2-3% and expects it to be around 5-6% in the coming quarters
Break up of Rs. 1900 Cr capex plan
Most of the capex will be funded through internal accruals and some debt will be taken.
1) Rs. 800 Cr towards debottlenecking and brownfield expansion of tyre plant at Bhuj. Expansion to add 50k tons capacity by mid FY23. This will increase total tyre capacity to 335k tons over next 4 years.
2) Rs. 650 Cr will be spent by H1FY23 towards carbon black capacity increase from 140k to 200k tons incl. 30k tons of advanced carbon material for 3rd party sale. This will lead to full in-house carbon black sourcing by the company. Between 25-30% of total capacity will be available for 3rd party sales. Profitability here will be lower than co margins and will be at 15-16% and thus will be ROCE dilutive. Payback period will be 5-6 years.
3) Rs. 450 Cr will be spent for modernization & automation and material handling systems at Bhuj and Rajasthan by H1FY23. This modernization drive happens once every 7-8 years. Payback period will be 5 years. This will drive margins higher in the long run although in the short run shall impact asset turns and ROCE.
Share is trading at P/E of 28.9x FY22E EPS
*Tasty Bite Eatables Ltd.* | *CMP* Rs. 15989 | *M Cap* Rs. 4103 Cr | *52 W H/L* 17000/8785
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 121.9 Cr (2.6% QoQ, 5.9% YoY) vs QoQ Rs. 118.8 Cr, YoY Rs. 115.1 Cr
EBIDTA came at Rs. 21.1 Cr (20.5% QoQ, 66.9% YoY) vs QoQ Rs. 17.5 Cr, YoY Rs. 12.6 Cr
EBITDA Margin came at 17.3% vs QoQ 14.7%, YoY 11%
Adj. PAT came at Rs. 13.9 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8.5 Cr
Quarter EPS is Rs. 54
Share is trading at P/E of 104.3x TTM EPS
(Nirmal Bang Retail Research)
*Result has improved*
Revenue from Operations came at Rs. 121.9 Cr (2.6% QoQ, 5.9% YoY) vs QoQ Rs. 118.8 Cr, YoY Rs. 115.1 Cr
EBIDTA came at Rs. 21.1 Cr (20.5% QoQ, 66.9% YoY) vs QoQ Rs. 17.5 Cr, YoY Rs. 12.6 Cr
EBITDA Margin came at 17.3% vs QoQ 14.7%, YoY 11%
Adj. PAT came at Rs. 13.9 Cr vs QoQ Rs. 13.5 Cr, YoY Rs. 8.5 Cr
Quarter EPS is Rs. 54
Share is trading at P/E of 104.3x TTM EPS
*Escorts Ltd Q4FY21 Con-call Update*
(Nirmal Bang Retail Research)
*Outlook: Positive in long term*
• Revenue for tractor grew by 64.3% YoY to Rs. 1738.8 Cr with sales of 32558 units as against 20108 units YoY (62.1% YoY and 3.3% QoQ). The company witnessed a drop in market share by 13 bps at 12.9% on a YoY basis but it was an increase of 132 bps sequentially
• EBIT margin at 17% up by 120 bps (15.8% YoY) due to better product mix, better operating leverage and cost reduction and leaner operations
• The Agri-Machinery segment (79% of the revenue mix in Q4FY21) grew by 61.8%YoY and 2.9% QoQ with commercial tractors (higher HP) usage witnessing a sharp increase and capacity utilization at 100%.
• Construction Equipment segment (15% of the revenue mix in Q4FY21) up by 62.7% at 1604 units YoY and 27.9% QoQ due to better product mix, price increase and cost optimization. with a capacity utilization at 50%
• Railway division (7% of the revenue mix in Q4FY21) revenue at Rs. 146.5 Cr up by 35.6% YoY with 43% revenue from conventional segment and 58% from New Product Development.
• EBIT for rail division is at Rs. 28 Cr, up by 85.2% and margin of 19.1% up by 57ps YoY
• Indian Railways is still not running its full operations, due to unprecedented COVID19 pandemic situation and has done revision in the production plan, affecting fresh order tendering and order inflow
• The company has had two price hikes, one in mid-November of around 2% and around 3% in early April and is also expecting another price hike in Q2FY22
• Supply chain had been smoothening but due to the second wave of Covid leading to lockdowns in various states has once again affected the supply chain negatively
• The company expects an inflation of 8-10% of current commodity prices
• The order book for Railway division as of Mar’21 is at Rs. 340Cr and has an execution time of 6-8 months. Due to the pandemic, fresh order tendering and order inflow has been adversely impacted
• Capex for FY22 to be up to Rs. 300-325 Cr which will be utilized for increasing capacity in various plants
• The JV with Kubota, Escorts Kubota India have started commercial production of Kubota Tractors and has entered in the markets but with a small volume of 5400 units which is increasing month on month.
Share is trading at P/E of 13.8x FY22E EPS
(Nirmal Bang Retail Research)
*Outlook: Positive in long term*
• Revenue for tractor grew by 64.3% YoY to Rs. 1738.8 Cr with sales of 32558 units as against 20108 units YoY (62.1% YoY and 3.3% QoQ). The company witnessed a drop in market share by 13 bps at 12.9% on a YoY basis but it was an increase of 132 bps sequentially
• EBIT margin at 17% up by 120 bps (15.8% YoY) due to better product mix, better operating leverage and cost reduction and leaner operations
• The Agri-Machinery segment (79% of the revenue mix in Q4FY21) grew by 61.8%YoY and 2.9% QoQ with commercial tractors (higher HP) usage witnessing a sharp increase and capacity utilization at 100%.
• Construction Equipment segment (15% of the revenue mix in Q4FY21) up by 62.7% at 1604 units YoY and 27.9% QoQ due to better product mix, price increase and cost optimization. with a capacity utilization at 50%
• Railway division (7% of the revenue mix in Q4FY21) revenue at Rs. 146.5 Cr up by 35.6% YoY with 43% revenue from conventional segment and 58% from New Product Development.
• EBIT for rail division is at Rs. 28 Cr, up by 85.2% and margin of 19.1% up by 57ps YoY
• Indian Railways is still not running its full operations, due to unprecedented COVID19 pandemic situation and has done revision in the production plan, affecting fresh order tendering and order inflow
• The company has had two price hikes, one in mid-November of around 2% and around 3% in early April and is also expecting another price hike in Q2FY22
• Supply chain had been smoothening but due to the second wave of Covid leading to lockdowns in various states has once again affected the supply chain negatively
• The company expects an inflation of 8-10% of current commodity prices
• The order book for Railway division as of Mar’21 is at Rs. 340Cr and has an execution time of 6-8 months. Due to the pandemic, fresh order tendering and order inflow has been adversely impacted
• Capex for FY22 to be up to Rs. 300-325 Cr which will be utilized for increasing capacity in various plants
• The JV with Kubota, Escorts Kubota India have started commercial production of Kubota Tractors and has entered in the markets but with a small volume of 5400 units which is increasing month on month.
Share is trading at P/E of 13.8x FY22E EPS