Sensex vulnerable to FY13 downgrades: Emkay Global

Anish Damania, business head - institutional equities, Emkay Global Financial Services joins CNBC-TV18 to give his outlook on the market and the economy.

Q: Ahead of the earnings season what are you expecting of the Sensex EPS? Any kind of downgrade? What would be your revenue estimates?
A: Basically, we are looking at about 20% odd sales growth, about 12% EBITDA growth and also close to 7% profit growth. So I am looking at a funnel kind of a situation where that continues. It has been there since the last two quarters where your sales growth is highest, EBITDA growth is lower than the sales growth, and PAT growth is still lower than EBITDA growth.
One of the things which I make out of this is if there is a further slowdown in the economy, a small delta change will bring about a higher change in PAT growth or a decline. So to that extent, we still remain vulnerable to downgrades as we go ahead.
My sense is that the downgrades are probably going to happen more for FY13 because while we downgraded FY12 estimates, FY13 also got downgraded in line with FY12. So the growth from FY12 to FY13 is still about 15-16%. Q: What would you tank up on before the result season starts in right earnest? Where do you see perhaps relative, not outperformance, but at least market performance?
A: I don