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vtycoon
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16 Oct 2008 21:51
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as major world economies will enter recession , demand fr footwear`s will decline significantly hence impacting bata`s business ! ..
it will have a direct impact on its earning which have been discounted in bata`s share price ...
its a strong buy @ 85-90 ....d a SL 82 ..... fr a short term target f 100-115...
it will have a direct impact on its earning which have been discounted in bata`s share price ...
its a strong buy @ 85-90 ....d a SL 82 ..... fr a short term target f 100-115...
16 Oct 2008 21:34
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Larsen & Toubro has posted gross sales of Rs.7,777 crores for the quarter ending September 2008, registering a growth of 40% over the corresponding quarter of previous year. Total income for the quarter grew to Rs.7,842 crores (Rs.5.523 crores for quarter ending Sept. 07) registering a growth of about 42%. This is more than expectations, as 35% growth in topline on an annualized basis is being projected by the analysts for the company.
However, disappointment came from pressure on margins, which has resulted into a lower growth at operating profit and net profit levels. EBIT for the quarter is at Rs.760 crores against Rs.561 crores of the corresponding quarter of previous year, recording a growth of 35.50%. PAT rose to Rs.460 crores (Rs.348 crores) which grew by 32%. Interest costs increased to Rs.69 crores against Rs.13.24 crores for Sept. 07 quarter and Rs.38.24 crores for June 08 quarter.
Inspite of global slowdown, the company secured fresh orders of Rs.12,453 crores during the quarter, which recorded a y-o-y growth of 74%. Of this, engineering & construction orders are of Rs.10,434 crores, registering a growth of 90%, with share of international orders at 22%. As at 30-09-08, this division had an order book of Rs.60,931 crores with share of international orders being 17%.
EPS for first half of the company, on expanded equity base of Rs.117 crores, is at Rs.16.50. Generally, September quarter of the company is always lean while March quarter is robust. On full year base, FY 09 EPS, should be close to Rs.48.
Post result announcements, the share price of the company fell by about 10% to Rs.900. On expected FY 09 earnings, share is ruling at a PE of less than 20. The company is confident of posting a growth of about 30% in topline and bottomline for FY 09 and FY 10, which looks possible, considering its order book and improvement in its margin from 10.60% to 11% in its engineering and construction division, from which 80% of the company’s turnover comes.
One may not be able to catch the bottom for the stock, but those who have 12 month horizon, can contemplate buying at Rs.900 levels and those who are holding it are advised to remain invested....
However, disappointment came from pressure on margins, which has resulted into a lower growth at operating profit and net profit levels. EBIT for the quarter is at Rs.760 crores against Rs.561 crores of the corresponding quarter of previous year, recording a growth of 35.50%. PAT rose to Rs.460 crores (Rs.348 crores) which grew by 32%. Interest costs increased to Rs.69 crores against Rs.13.24 crores for Sept. 07 quarter and Rs.38.24 crores for June 08 quarter.
Inspite of global slowdown, the company secured fresh orders of Rs.12,453 crores during the quarter, which recorded a y-o-y growth of 74%. Of this, engineering & construction orders are of Rs.10,434 crores, registering a growth of 90%, with share of international orders at 22%. As at 30-09-08, this division had an order book of Rs.60,931 crores with share of international orders being 17%.
EPS for first half of the company, on expanded equity base of Rs.117 crores, is at Rs.16.50. Generally, September quarter of the company is always lean while March quarter is robust. On full year base, FY 09 EPS, should be close to Rs.48.
Post result announcements, the share price of the company fell by about 10% to Rs.900. On expected FY 09 earnings, share is ruling at a PE of less than 20. The company is confident of posting a growth of about 30% in topline and bottomline for FY 09 and FY 10, which looks possible, considering its order book and improvement in its margin from 10.60% to 11% in its engineering and construction division, from which 80% of the company’s turnover comes.
One may not be able to catch the bottom for the stock, but those who have 12 month horizon, can contemplate buying at Rs.900 levels and those who are holding it are advised to remain invested....
16 Oct 2008 16:05
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Electrosteel Castings has posted very good results for quarter ended 30th September 08 with total income touching at Rs.545.87 crores (Rs.317.48 crores for Sept. 07 quarter) with net profit placed at Rs.42.12 crores against Rs.28.89 crores for previous corresponding quarter. This is after providing for interest of Rs.39.64, which includes derivatives losses and foreign exchange difference on borrowings, against an income of Rs.7.09 crores, in the corresponding quarter of previous year. In the current quarter, deferred tax provisions were high at Rs.20.98 crores against Rs.1.09 crores of the Sept. 07 quarter.
Due to this, cash profit of the company for the quarter is at Rs.73.03 crores against Rs.38.77 crores for the corresponding quarter in previous year and Rs.77.18 crores for FY 08. This is without doing any adjustment for forex and derivative MTM provisions.
EPS for the quarter is placed at Rs.1.50 while cash EPS is at Rs.2.60.
The Board of the company proposes to issue 4.24 crores equity shares of Re.1 each, to two non-promoters overseas companies, at Rs.38 per share. Even promoters of the company have recently converted 6.25 lakh warrants into equity at Rs.43.80 per share, against the current price of share ruling at Rs.19. This is in the backdrop of the fact that promoters of Hindalco and Rajashree Sugars have not opted to convert or subscribe warrants due to fall in market price.
As on 30-09-08, the company had MTM loss of Rs.32.14 crores, arising out of foreign exchange contracts for hedging future exports against currency risks. Outstanding derivative contracts had MTM loss of Rs.19.81 crores as at 30-09-08. Though concern on these losses remains, but if the company has provided for it, and still has been able to post good growth in its bottomline, one should not take them with too much concerns.
Share having a book value of Rs.42 is now ruling at Rs.19 and FY 09 EPS is expected to be close to Rs.10 from its normal operations. Maybe, forex and derivative loses should get over by end of FY 09 and the company thereafter, should be able to post its normal operations.
Due to the concerns of forex and derivative losses, even good results have gone unnoticed. At Rs.19 share holds long term potential.
...
Due to this, cash profit of the company for the quarter is at Rs.73.03 crores against Rs.38.77 crores for the corresponding quarter in previous year and Rs.77.18 crores for FY 08. This is without doing any adjustment for forex and derivative MTM provisions.
EPS for the quarter is placed at Rs.1.50 while cash EPS is at Rs.2.60.
The Board of the company proposes to issue 4.24 crores equity shares of Re.1 each, to two non-promoters overseas companies, at Rs.38 per share. Even promoters of the company have recently converted 6.25 lakh warrants into equity at Rs.43.80 per share, against the current price of share ruling at Rs.19. This is in the backdrop of the fact that promoters of Hindalco and Rajashree Sugars have not opted to convert or subscribe warrants due to fall in market price.
As on 30-09-08, the company had MTM loss of Rs.32.14 crores, arising out of foreign exchange contracts for hedging future exports against currency risks. Outstanding derivative contracts had MTM loss of Rs.19.81 crores as at 30-09-08. Though concern on these losses remains, but if the company has provided for it, and still has been able to post good growth in its bottomline, one should not take them with too much concerns.
Share having a book value of Rs.42 is now ruling at Rs.19 and FY 09 EPS is expected to be close to Rs.10 from its normal operations. Maybe, forex and derivative loses should get over by end of FY 09 and the company thereafter, should be able to post its normal operations.
Due to the concerns of forex and derivative losses, even good results have gone unnoticed. At Rs.19 share holds long term potential.
...
16 Oct 2008 16:04
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Reliance Industries Ltd. (RIL) share price has plummeted by about 11% to Rs.1,350 per share today, which is way below promoter’s warrant conversion price of Rs.1,402 per share.
If one may recall, Mukesh Ambani, promoter of RIL had subscribed to 12 crores warrants of the company, to be converted into equal number of shares, at Rs.1,402 per share and total investment was Rs.16,824 crores. When we have seen many promoters not going in for warrant conversion or warrant subscription, this move had imbibed confidence into the market, when the same were converted, in the first week of October 08. Remember, Hindalco Industries promoters have allowed their warrant to get lapsed and have foregone Rs.130 crores paid by them at the time of warrant subscription, which were on 11th April 07, one day ahead of RIL warrant subscription by the promoters, viz. 12th April 07.
RIL share today though opened at Rs.1,465 against it previous day’s close to Rs.1,519, but fell to a low of Rs.1,327 and about 18 lakh shares were traded on BSE till 1 pm at an average rate of Rs.1,373 per share and while about 57 lakh shares on NSE at Rs.1,371 per share. This kind of fall in share price can happen only with delivery based selling, which may have been pressed by the institutional investors.
The stake of domestic mutual funds and insurance companies, in the company as at 30-09-08, is to the extent of about 9% with about 13 crores shares held by them. FIIs have been holding about 17% stake of the company, being 24.67 crore shares on that date, with 1,091 holders. Value of the investment at Rs.1,400 per share works out to Rs.34,000 crores being US $ 7 billion, of FII investors.
In view of FII selling of close to US $ 10 billion till date, in calendar year 2008, in the Indian market, it is feared that selling in RIL stock has been made by these FIIs only, on opening of the market. The same would get confirmed with FII datas to be released by the regulator in the next couple of days.
It is said that FIIs call to press sell button in the stock has nothing to do with the fundamental of the company but compulsion for them to mobilize liquidity at their end, by divesting stake in the frontliners. Due to this reason, we have seen a fall of about 11% in share price of TCS, as FII stake in TCS, as at 30-09-08, has been high at about 11%.
RIL share price was ruling at around Rs.1,400 per share in April 07, when the promoters have gone for warrant subscription, at an effective price of Rs.1,402 per share. RIL share had its 52 week high of Rs.3,252 per share, touched on 15-01-08 with low of Rs.1,327 having touched today. With RIL share price having moved past 3 K in January 08, everyone had praised the move of the promoters, as warrant subscription have made them richer by over Rs20,000 crores. At that time, it was found this to be a visionary move by the promoters as huge jump in the financial performance of RIL was expected, due to commencement of gas production by the company in KG D-6 block as also its subsidiary Reliance Petroleum, starting commercial production of its refinery at Jamnagar, way ahead of its scheduled date of December 08.
Now, the market is attributing reason for divesting the stake by FIIs due to concern on margins and profitability by RIL in the coming quarters. Expectations of fall in GRM due to softening crude prices as also steep fall in global petrochemical demand are seen as two main reasons. Though RIL has been able to maintain its volume and margin growth in Petchem segment, the same looks doubtful in the coming quarters. Even GRM, which has been ruling above $15 per barrel is likely to fall to $12 per barrel in Q2 and may head to touch in single digit by the end of 4th quarter of FY 09.
RIL for FY 08, had posted an EPS of Rs.105, before extraordinary items and mainly from its core business. EPS for June 08 quarter was placed at Rs.28.30 and it was expected that the same is likely to be about Rs.115,in FY 09, from its existing business thus giving a growth of slightly lower than 10% over FY 08. But now the same expectations may not hold true in view of concern stated above. Also it is expected that no significant contribution in FY 09 would come from RPL Refinery or KG Basin Gas Production. Both the projects would contribute in FY 10 only, may be for entire 12 months.
However, the contribution from both the new projects, in FY 10, though are difficult to assess now, but one can expect RIL to post an EPS of close to Rs.200 for FY 10. If we go by the same estimates the share is now ruling at a PE multiple of less than 7. Does this valuation makes the stock expensive?
In the scenario, we don’t think that fundamentals have any role to play when liquidity and sentiments are the dominating factors....
If one may recall, Mukesh Ambani, promoter of RIL had subscribed to 12 crores warrants of the company, to be converted into equal number of shares, at Rs.1,402 per share and total investment was Rs.16,824 crores. When we have seen many promoters not going in for warrant conversion or warrant subscription, this move had imbibed confidence into the market, when the same were converted, in the first week of October 08. Remember, Hindalco Industries promoters have allowed their warrant to get lapsed and have foregone Rs.130 crores paid by them at the time of warrant subscription, which were on 11th April 07, one day ahead of RIL warrant subscription by the promoters, viz. 12th April 07.
RIL share today though opened at Rs.1,465 against it previous day’s close to Rs.1,519, but fell to a low of Rs.1,327 and about 18 lakh shares were traded on BSE till 1 pm at an average rate of Rs.1,373 per share and while about 57 lakh shares on NSE at Rs.1,371 per share. This kind of fall in share price can happen only with delivery based selling, which may have been pressed by the institutional investors.
The stake of domestic mutual funds and insurance companies, in the company as at 30-09-08, is to the extent of about 9% with about 13 crores shares held by them. FIIs have been holding about 17% stake of the company, being 24.67 crore shares on that date, with 1,091 holders. Value of the investment at Rs.1,400 per share works out to Rs.34,000 crores being US $ 7 billion, of FII investors.
In view of FII selling of close to US $ 10 billion till date, in calendar year 2008, in the Indian market, it is feared that selling in RIL stock has been made by these FIIs only, on opening of the market. The same would get confirmed with FII datas to be released by the regulator in the next couple of days.
It is said that FIIs call to press sell button in the stock has nothing to do with the fundamental of the company but compulsion for them to mobilize liquidity at their end, by divesting stake in the frontliners. Due to this reason, we have seen a fall of about 11% in share price of TCS, as FII stake in TCS, as at 30-09-08, has been high at about 11%.
RIL share price was ruling at around Rs.1,400 per share in April 07, when the promoters have gone for warrant subscription, at an effective price of Rs.1,402 per share. RIL share had its 52 week high of Rs.3,252 per share, touched on 15-01-08 with low of Rs.1,327 having touched today. With RIL share price having moved past 3 K in January 08, everyone had praised the move of the promoters, as warrant subscription have made them richer by over Rs20,000 crores. At that time, it was found this to be a visionary move by the promoters as huge jump in the financial performance of RIL was expected, due to commencement of gas production by the company in KG D-6 block as also its subsidiary Reliance Petroleum, starting commercial production of its refinery at Jamnagar, way ahead of its scheduled date of December 08.
Now, the market is attributing reason for divesting the stake by FIIs due to concern on margins and profitability by RIL in the coming quarters. Expectations of fall in GRM due to softening crude prices as also steep fall in global petrochemical demand are seen as two main reasons. Though RIL has been able to maintain its volume and margin growth in Petchem segment, the same looks doubtful in the coming quarters. Even GRM, which has been ruling above $15 per barrel is likely to fall to $12 per barrel in Q2 and may head to touch in single digit by the end of 4th quarter of FY 09.
RIL for FY 08, had posted an EPS of Rs.105, before extraordinary items and mainly from its core business. EPS for June 08 quarter was placed at Rs.28.30 and it was expected that the same is likely to be about Rs.115,in FY 09, from its existing business thus giving a growth of slightly lower than 10% over FY 08. But now the same expectations may not hold true in view of concern stated above. Also it is expected that no significant contribution in FY 09 would come from RPL Refinery or KG Basin Gas Production. Both the projects would contribute in FY 10 only, may be for entire 12 months.
However, the contribution from both the new projects, in FY 10, though are difficult to assess now, but one can expect RIL to post an EPS of close to Rs.200 for FY 10. If we go by the same estimates the share is now ruling at a PE multiple of less than 7. Does this valuation makes the stock expensive?
In the scenario, we don’t think that fundamentals have any role to play when liquidity and sentiments are the dominating factors....
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16 Oct 2008 15:59
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15 Oct 2008 18:41
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15 Oct 2008 18:27
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