{LONGTERMINVESTORS} India Daily: Results; Results, Change in Reco - L&T Finance Holdings

 

 

 

Daily Alerts

Results

ITC: Not quite back to usual yet, but a lot to like

l 2QFY17 print - modest quarter; broadly in line with our estimates l Cigarette volumes steady; better mix continues to drive margins up l Business momentum shaping up well; stay positive - GST-related risks notwithstanding

HDFC: Loan growth remains strong; NIM under pressure

l Earnings up 14% yoy l Retail business going strong l NIM under pressure l Retain ADD, TP of Rs1,550

Hindustan Unilever: UVG turns negative, for the first time since March 2009

l 2QFY17 - UVG turns negative and misses modest expectations l Segmental performance - weak on most fronts l Broadly retain EPS estimates; REDUCE rating stays with unchanged TP of Rs885/share

Bharti Airtel: When the going gets tough…

l Bharti has done exceedingly well on most counts in recent times l Key changes to our estimates - marginal upward revision in EBITDA forecasts l Overall view and changes in SoTP-based valuation

Hero Motocorp: On expected lines, slowdown ahead in 2HFY17

l Lower commodity costs and cost-cutting initiatives drive strong EBITDA margins l Subdued outlook for Hero Motocorp in 2HFY17 l Maintain SELL rating

Torrent Pharmaceuticals: US spurs the miss

l Weak quarter led by sharp erosion in the US l US scale-up has benefitted from Abilify - set on mending US business l Expect pressures on profitability - REDUCE

IDFC Bank: Strong results

l Business momentum strong l Low NIM but strong fees l Capital gains support earnings l Retain ADD with TP of Rs80 (from Rs75)

Exide Industries: Improvement in gross margin unlikely to sustain

l 2QFY17 results above estimates on stronger-than-expected gross margin l Subdued demand for inverter batteries, slow auto replacement industry growth key concerns l Increase our FY2017-19E EPS estimates by 5-7%; maintain SELL with revised TP of Rs175

Canara Bank: Marginally better but RoEs still weak

l Better-than-expected performance helped by lower provisions and treasury income l Headline slippages showing positive trends of deceleration; resolutions yet to pick up l Maintain REDUCE; better, but current trends to continue for a few more quarters

JSW Energy: Catch-22

l Consolidated earnings marred by low offtake, hydro was the savior l New projects on hold, although Bina acquisition to go through l Maintain ADD with a revised target price of Rs75/share

Jubilant Foodworks: 2QFY17 - meets subdued SSG expectations but misses on margins

l 2QFY17 - SSG (+4.2%) ahead of expectations but push-based and hence a drag on margins l Earnings model changes - another weak print, another cut in estimates l Stock has moved from valuing the 'possible' to 'plausible' but not in the 'probable' zone yet

JK Lakshmi Cement: On a weak note

l Absence of volume growth impacts earnings for the quarter, tax credit helps l Volumes likely to be driven by expanded capacity base, increase in pet-coke prices factored l Maintain ADD rating with revised target price of Rs535/share

Ortel Communications: Mixed bag

l 2QFY17 - EBITDA growth of 24% led by core revenue streams and cost optimization l Collection - our key concern; a lot needs to be done l We cut FY2017-19 EBITDA estimate by 3-5% and TP to Rs185

Results, Change in Reco

L&T Finance Holdings: Moving up the trajectory

l Strong performance in 2QFY17 l Building in improving trajectory

 

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