CRISIL Research has come out with its report on Siyaram Silk Mills. The research firm has initiated coverage on the company with a Valuation Grade of ‘3/5’ and has maintained the fair value of Rs 374 per share.
CRISIL Research has come out with its report on Siyaram Silk Mills . The research firm has initiated coverage on the company with a Valuation Grade of ‘3/5’ and has maintained the fair value of Rs 374 per share.
Siyaram Silk Mills Ltd’s (SSML’s) Q4FY11 revenues were higher than CRISIL Equities’ expectations driven by strong growth across brands, whereas margins remained in line with expectations. Going forward we expect demand for clothing and furnishing fabric to remain strong. We maintain our fundamental grade of 4/5.
Q4FY11 result analysis
• EBITDA margins contracted by about 80 bps to 13% y-o-y largely on account of higher other expenses. Operating profitability remained flat qo-q.
• Lower EBITDA margin coupled with higher interest expenses lowered PAT margin by around 100 bps y-o-y. However, higher other income and stable operating profitability augmented PAT by 17% q-o-q to Rs 186 mn and improved PAT margin by 60 bps to 7.6%.
• The company has declared a dividend of Re 7 per share. At the current market price, dividend yield is 2%.
Revised capacity expansion on schedule
Revenue estimates revised marginally upwards
Valuations: Current market price is aligned
Disclaimer: This report (Report) has been commissioned by the Company/Investor/Exchange and prepared by CRISIL. The report is based on data publicly available or from sources considered reliable by CRISIL (Data). However, CRISIL does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. Opinions expressed herein are CRISIL's opinions as on the date of this Report. The Data / Report are subject to change without any prior notice. Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The Report is not a recommendation to buy / sell or hold any securities of the Company. CRISIL especially states that it has no financial liability, whatsoever, to the subscribers / users of this Report. This Report is for the personal information of the authorized recipient only. This Report should not be reproduced or redistributed or communicated directly or indirectly in any form to any other person or published or copied in whole or in part especially outside India, for any purpose.
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