JP Associates Q2 PAT seen down 35% at Rs 75 cr

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Jaiprakash Associates is likely to report a profit after tax of Rs 75 crore in the second quarter of FY12, a massive fall of 35% as compared to Rs 115 crore in the corresponding quarter of last fiscal.

Total income is seen going up 0.27% to Rs 3,080 crore from Rs 3,071 crore during the same period.

EBITDA is likely to go down 6% to Rs 714 crore in the July-September quarter of FY12 versus Rs 759 crore in a year ago period.

Operating profit margin is expected to be at 23.19% versus 24.71% year-on-year.

Cement dispatches and realizations

Cement dispatches to have picked up marginally YoY

Realizations to remain flat YoY
* Realizations to decline QoQ due to cement prices having corrected in the north and east

Cement biz contributes around 40% to JPA's overall revenues

What to expect

Expect a decline in EPC revenues as Q2 is seasonally weak for construction biz

Cement revenues expected to remain flattish due to marginal vol growth and flat realizations

Expect real estate biz revenues to grow YoY and to partly offset decline in EPC revenues

Margin pressure expected due to rising cost pressure

Much higher interest costs YoY to lead to bottom line shrinkage

Key monitorable ---

There has been some talk about JPA looking to restructure its cement biz

Buzz about a possible stake sale as well

Cement biz alone has Rs 14100 crore of debts currently; move could be to bring down debt

Company's cement capacity currently stands at around 26mn tonnes
* Company has plans of expanding the capacity to around 37 million tonnes by FY12 end.

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