Sunday, 31 January 2016

Re: {LONGTERMINVESTORS} Research Reports extracts & summaries - Thread

Macquarie on L&T
* Maintain outperform, 12-month target price at '1469
* Positive surprise on order inflow front, mgmt's revenue guidance to help bounce back 
* Strong growth from Middle East revenues is positive, but risks remain on low crude price
* Q4 results with pick up in domestic revenue remains key catalyst for upside

Credit Suisse on L&T
* Maintain Outperform, Target cut to `1425 from `1475
* Overall results weaker than anticipated, order inflows positive surprise
* Order inflows positive surprise on back of strong domestic order book
* Cut in order inflow guidance already priced in
* Retain revenue guidance, implies pick up to be seen in 4Q
* Margins weakened in large projects pending threshold level of execution

CLSA on Marico
* Raise target to `245 from `230, Maintain Outperform
* Strong volume growth and impressive margin expansion
* 10% volume growth makes it the fastest growing consumer firm in 3QFY16
* Management targets 8-10% YoY volume growth in the medium term
* Volume growth of Saffola and VAHO should be 10% and 12-15%
* Focus would continue on distribution expansion and new products

Macquarie on TVS Motors
* Maintain outperform, 12-month target price at '345
* Stable margins despite adverse export conditions helped by low commodity costs
* Two thirds of biz exposed to fast growing segments, strong product action 
* Expect tripled earnings over FY15-18 unpinned by strong EPS growth over 5 years

Macquarie on JSW Steel
* Maintain Neutral, 12-month target price at 948
* Weak steel prices to lower margins until govt delivers protection using MIP
* Expect 25% increase in capacity making it well-poised for strong volume performance 
* Expect earnings downside of 15-20% on back of delayed MIP, weak international sales

Macquarie on Yes Bank
* Maintain Outperform, 12-month target price at '900
* Expect strong earnings growth, stable asset quality to guide growth 
* Believe current valuations offer significant comfort even with unforeseen mgmt risks
* Mgmt's indication of recognition of 75% of RBI accounts projects strong asset quality for Q4

Deutsche Bank on JSW Steel
* Maintains Buy, TP cut to `1200 from `1215
* Weak quarter as expected; expect recovery in ensuing quarters
* Miss at consolidated level attributable primarily to weak subsidiary performance
* Higher fixed costs caused by Furnace shutdowns, affecting profitability
* Lower iron ore & coking costs & improved product mix to support recovery

Deutsche Bank on NTPC
* Maintains Buy, TP cut to `165 from `167
* Profits flat, interest income down due to higher capex & bonus debentures
* Core ROE down due to higher full fixed cost recovery in base quarter
* Generation was lower due to weak demand
* To be driven by strong capacity growth addition of 15-18GW over next 3 yrs

Deutsche Bank on TVS Motor
* Maintains Hold, Target `260
* In-line results, mgmt guides for aggressive market share gains
* PAT surprised positively due to higher other income & lower tax rate
* Building in strong earnings growth, FY16-18E CAGR of 25%
Inventory remains stable at 28-32 days
* Exports to see near-term hit due to currency depreciation & lack of USD in African markets

Deutsche Bank on UPL
* Maintains Buy, TP cut to `575 from `595
* Delivers consistent growth & Margin expansion surprises positively
* Volume growth on high base, tough operating conditions & volatility in EM currencies
* Expect 17% EPS CAGR over FY16-18E driven by robust volume growth
* Reasonable valuation at FY17 P/E of 12x, 25-30% discount to global peers

Deutsche Bank on Yes Bank
* Maintains Buy, Target `900
* Strong quarter on all counts: growth, CASA, NIM & asset quality
* Asset quality remains stable, slippages rise, but strong in current context
* Strong loan growth of +27% YoY, driven by both corporate (+24%) and retail (+33%)
* About 76% of portfolio is rated A or better & >97.7% is BBB and above
* NIMs improved as funding costs down 20bps & yields on advances down 10bps QoQ

CLSA on PVR
* Maintain Buy, target price at `1080
* High employee costs, low EBITDA margins, high entertainment tax were major negatives
* ATP growth of 8%, high advertising revenue remain positives for firm
* High gross margin F&B, ad sales coupled with GST to expand EBITDA margin in future

CLSA on Pidilite Industries
* Raise target to `463 from `455, Maintain Sell
* Recent crude correction caused short term windfall gains expanding EBITDA margins
* Competitive pressure is high, demand is muted, high EBITDA margins are unsustainable 
* Expect downside on back of weak risk-reward, long-term EPS downgrade risk

BofA ML on Shriram Transport
* Maintain Buy, target price at `1175
* High new truck demand on back of BS fitting in trucks, implementation of BS-4 
* Expect pick-up in growth on parent level, rising margins, unwinding of credit costs 
* Asset quality remains comfortable, much lower against competition

 

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