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Jun 04, 2012, 06.09 PM IST
CRISIL Research has come out with its report on Phoenix Mills. The research firm has maintained the fundamental grade of 3/5 to the company in its May 30, 2012 report.
CRISIL Research has come out with its report on Phoenix Mills . The research firm has maintained the fundamental grade of 3/5 to the company in its May 30, 2012 report.
The Phoenix Mills Ltd’s (Phoenix’s) Q4FY12 standalone results were in line with CRISIL Research’s expectations. FY12 consolidated revenues exceeded CRISIL Research’s expectations but earnings were significantly below due to lower-than-expected margins and higher interest costs. High Street Phoenix (HSP), representing the standalone business, continued steady performance. Cost escalations in market city projects led to an increase in debt and, hence, higher interest costs impacted consolidated profits. We will revisit earnings estimates post interaction with the management. We maintain our fundamental grade of 3/5.
Q4FY12 and FY12 standalone result analysis
• Q4FY12 EBITDA margin increased 90 bps y-o-y to 68.4% mainly due to an increase in lease rentals. On a q-o-q basis, margins declined 550 bps due to higher other expenses. FY12 EBITDA margin declined slightly by 30 bps y-o-y to 70.7%.
• Improvement in operating margin was offset by higher interest costs, as a result PAT was flat y-o-y at Rs 273 mn. On a q-o-q basis, PAT grew 2% supported by growth in other income. FY12 PAT grew 15% y-o-y to Rs 1,053 mn.
Analysis of FY12 consolidated results
• PAT registered a growth of 26% y-o-y to Rs 1,056 mn as revenue growth was offset by decline in margins and significant increase in interest costs.
FY12 balance sheet key takeaways
Valuations: Current market price has strong upside
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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