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Jan 20, 2012, 04.52 PM IST
CRISIL Research has come out with its report on Century Plyboards (India). The research firm has maintained the fundamental grade of 3/5 to the company in its January 19, 2012 report.
CRISIL Research has come out with its report on Century Plyboards (India) . The research firm has maintained the fundamental grade of 3/5 to the company in its January 19, 2012 report.
Century Plyboards (India) Ltd’s (Century Plyboards’) Q3FY12 revenues, up y-oy and q-o-q, were marginally above CRISIL Research’s expectations. However, raw material, interest cost and foreign exchange loss impacted the profitability of the company. We may revisit our estimates post our interaction with the management. We maintain the fundamental grade of 3/5.
Q3FY12 result analysis
• The y-o-y increase in raw material costs was offset by lower other expenditure (as a percentage of sales), resulting in flat EBIT margins. While the EBIT margin for the plywood business increased 280 bps y-o-y, the cement business’ margin dropped by 90 bps. We believe the higher coal costs may have resulted in margin decline in the cement business. While the laminate and logistics businesses’ margins witnessed an increase of 470 bps
• Interest cost rose by 102.5% y-o-y (up 50% q-o-q), impacting the profitability of the company.
• The continued depreciation of the rupee during the quarter resulted in the company booking foreign exchange loss of Rs 316 mn.
• Tax expenses were negative Rs 12 mn on account of the creation of deferred tax asset. The tax for the period Apr-Dec 2011 has been significantly below our estimates. Minority interest declined by 26.2% y-o-y (up 115.8% q-o-q) during the quarter. Adjusted PAT increased by 34.1% yo-y (down 12.1% q-o-q).
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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