Dolat Capital is bullish on Sterlite Industries (India) and has recommended accumulate rating on the stock with a target of Rs 118 in its April 26, 2012 research report.
“Sterlite Industries’s (SIL) reported PAT at Rs 12.76bn (DCe: Rs 14.4bn) declined 26.9% QoQ/17% YoY as it was hit by higher interest cost and exceptional loss for provision of ASARCO dispute, despite forex gain of Rs 3.31bn for the quarter. Net sales rose 5% QoQ to Rs 107.6bn (DCe Rs 104.bn), whereas EBITDA, at Rs 27.1bn beat estimate of Rs 25.7bn on better performance of power and copper business. Hindustan Zinc’s (HZL) Q4 FY12 EBITDA, at Rs 16.42bn (DCe :Rs 16.2bn) were led by higher silver and lead sales. Standalone Copper EBITDA at Rs 2.7bn (DCe Rs 2.7bn) were inline whereas Zinc International (ZIL) EBITDA at Rs 3.69bn were below our estimate due to higher cost.The power business’s EBITDA, at Rs 2.39bn (DCe: Rs 1.7bn) were better due to lower cost of power at SEL which declined by 16.2%QoQ to Rs 2.3 per unit.”
“BALCO and VAL aluminum EBITDA at Rs 950mn and Rs 2.22bn were better than our estimate of Rs 623mn and Rs 1.9bn respectively due to stable cost.VAL reported a loss of Rs 5.42bn (DCe: Rs 5.1bn) due to higher interest cost and forex loss of Rs 750mn. We have decreased our EBITDA estimates for FY13E by 2.5% to factor in lower guidance of volumes at Zinc international and lower PLF of 65% at SEL in FY13E. We believe the regulatory headwinds will continue to persist post restructuring for Sesa Sterlite and expect the stock performance to be muted in FY13 on back of low LME, concerns regarding volumes in its iron ore business, and high cost VAL operations. Given the recent price correction, we change our rating from Reduce to Accumulate with a target price of Rs 118 per share,” says Dolat Capital research report. Non-Institutions holding more than 90% in Indian cos Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies 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. To read the full report click on the attachment
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
