CRISIL Research has come out with its report on Sangam (India). The research firm have revised their earnings estimates, rolled forward the discounting year to FY15 and revised the fair value to Rs 73 from Rs 58 per share.
CRISIL Research has come out with its report on Sangam (India) . The research firm have revised their earnings estimates, rolled forward the discounting year to FY15 and revised the fair value to Rs 73 from Rs 58 per share.
Sangam (India) Ltd's (Sangam's) Q3FY13 results were below CRISIL Research's expectations. Revenues decreased by 14.6% q-o-q (up 6.2% y-o-y) to Rs 3,295 mn due to 7.1% q-o-q dip in textile revenues and absence of revenues from the toll collection business. Sangam held collection rights from National Highway Authority of India (NHAI) to collect toll from toll centers in Rajasthan, Gujarat and JNPT, Mumbai. The toll collection contracts ended in Q2FY13.
EBITDA margin contracted by 20 bps q-o-q (up 554 bps y-o-y) to 15.6% due to lower contribution from the high-margin denim segment; the decline was partially offset by the absence of the low-margin toll collection business. Interest cost increased by 7% q-o-q due to higher utilisation of working capital limits compared to the previous quarter. Adjusted PAT declined by 39% q-o-q to Rs 111 mn and PAT margin contracted by 133 bps q-o-q to 3.4%. We maintain the fundamental grade of 3/5.
Textile revenues down 7.1% q-o-q due to lower demand
Lower contribution from denim segment weighed on textile EBIT
Fair value revised to Rs 73
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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