Future Retail Q2 PAT may dip 37% at Rs 2.4cr: Motilal Oswal

Motilal Oswal has come out with its second quarter (April-June) earnings estimates for the retail sector. The brokerage house expects Future Retail to report a 21.3 percent growth quarter-on-quarter (fall of 37.1 percent year-on-year) in net profit at Rs 2.4 crore.

Revenues are expected to decrease by 15.4 percent Q-o-Q (down 17 percent Y-o-Y) to Rs 2,460 crore, according to Motilal Oswal.

Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to fall by 17 percent Q-o-Q (down 25.2 percent Y-o-Y) to Rs 206.6 crore.

Motilal Oswal report on Future Retail

For 2QCY13, reported results will include only Future Retail numbers. The base quarter included Pantaloon, Brand Factory and Central.
Hence, the quarterly numbers will not be amenable for like-to-like comparison.

We expect Future Retail to report sales of INR 24.6 billion.

Same store sales (SSS) growth would be 7-8 percent in the Value segment.

We estimate EBITDA at INR 2.06 billion (8.4 percent margin).

We expect a sequential decline of 23 percent in interest cost to INR 1.2 billion.

Adjusted PAT is likely to be INR 24 million.

Key issues to watch out

Same-store sales (SSS) performance - commentary on consumer demand

Clarity on debt and inventory strategy post the deals

Timelines for listing of de-merged entity