Hero MotoCorp Rating: BUY Target Price: Rs 2200 Rationale: The compant beat Q4 EBITDA estimate by 7% on the back of a richer product mix and a favorable Yen. Demand environment remains weak and FY14 volume growth over 5% would be a challenge However, concerns over loss of market share of the company are overdone
Federal Bank Rating: BUY Target Price: Rs 600 Rationale: Federal Bank’s (FB) Q4FY13 results inline with expectations with adj NII/ PAT Rs5.4bn/ Rs2.2bn. Advance/ Deposit growth strong at 11% quarter-on-quarter. Net interest margin (NIM’s) adjusted for interest reversal remain stable at 3.2%. Asset quality deteriorates as slippages higher at Rs3.5bn.
Shree Cements Rating: HOLD Target Price: Rs 4350 Rationale: Energy cost saving help EBIDTA beat, pricing remains weak. EBITDA at Rs 4.05 bn (+9% Y-o-Y) above est of Rs3.9bn - lower pet coke prices (down 7% Q-o-Q) help drive energy savings driving EBIDTA beat. EBIDTA/t Rs1042 +3.8% Y-o-Y, 2.5% Q-o-Q. Weak demand and pricing clearly visible-cement revenues decline 2% yoy. Volumes drop 6.2% Y-o-Y while realisations though +4.8% YoY decline 3.7% QoQ. Pricing power remains weak as cement prices continue to slide even in seasonally strong period.
Rallis India Rating: ACCUMULATE Target Price: Rs 144 Rationale: Results were below estimates as lower-than-expected margins dragged profitability. Revenue increased by 32% while PAT increased by 2.5x to Rs 105mn on low base. Higher raw material cost and poor demand has put pressure on margins in FY13. However revenue growth of 14% in FY13 was primarily driven by exports.
Hexaware Technologies Target: BUY Target Price: Rs 105 Rationale: Mach 13 quarter results inline on revenues, margins beat estimates aided by headcount rationalization. Better operating profits and forex gains help drive net profit beat. Top client revenues grow by more than 13% as non top client revenues remain flat. Europe drives growth amongst geographies