Motilal Oswal has come out with its first quarter (April-June) earnings estimates for the auto sector. The brokerage house expects Amara Raja to report a 30.6 percent growth quarter-on-quarter (growth of 16.1 percent year-on-year) in net profit at Rs 141.8 crore.
Sales are expected to increase by 8.9 percent Q-o-Q (up 12.0 percent Y-o-Y) to Rs 1274.1 crore, according to Motilal Oswal.
Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 19.8 percent Q-o-Q (up 15 percent Y-o-Y) to Rs 228.6 crore.
Motilal Oswal's report on Amara Raja
We expect AMRJ’s revenue to grow 12 percent Y-o-Y (+9 percent Q-o-Q) to INR 14b. New capacities in 2Ws, 4Ws and tubular batteries are likely to drive volumes in 1QFY17 and FY17. Spot LME lead prices increased 6 percent Q-o-Q in 4QFY16 (2.9 percent Q-o-Q in 1QFY17) —the impact is likely to be reflected in 1QFY17. EBITDA margin is likely to expand 160bp Q-o-Q (+50bp Y-o-Y) to 17.9 percent. Rise in raw material costs due to higher lead prices Q-o-Q is likely to be offset with lower other expenses and benefits of operating leverage, driving margin expansion. We expect PAT to grow 16 percent Y-o-Y to Rs 1.4b.Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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