Emkay > GMR Infra | Voltamp | Eicher Motors

[Deepak Vaishnav]

 

GMR Infrastructure

Subdued quarter – Inline performance – Buy

 

BUY

 

CMP: Rs 26                                       Target Price: Rs 38

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n     Net loss at Rs 625mn v/s Rs 483mn - led by marginally lower operational numbers for Power and Airport segment, Roads inline, EPC & other segment ahead of estimates 

n     Rev. up 48.3% to Rs 18.1bn v/s exp. of Rs 17.5bn led by EPC segment +282% yoy to Rs2.9 bn v/s 1.7 bn & others at Rs 1.9bn v/s 1.2bn, EBITDA up 40% at Rs 5bn v/s exp. Rs 4.7bn

n     Delays in aero charge hike at DIAL continue to drag the overall performance. Restriction to collect ADF leading to higher bridge loan & hence higher interest exp.   

n     Maintain BUY rating PT Rs 38 offers 49% upside from the current market price. Peaking interest rates cycle will be the key drivers of value in the near term

 

Regards,

Ajit Motwani

Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com | Email : ajit.m...@emkayglobal.com

Board No. : +91-22-66121212 | Extn. : 255 | DID : 66121255 | Mob : +919820934229 |

Jitesh Bhanot

Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com | Email : jitesh...@emkayglobal.com

Board No. : +91-22-66121212 | Extn. : 491 | DID : 66242491 | Mob : +919221393422 |

 

 

Voltamp Transformers

Marginally below; Maintain earnings and Hold

 

HOLD

 

CMP: Rs 500                                       Target Price: Rs 491

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n     PAT of Rs94mn (flat qoq and yoy) is below estimate due to both lower dispatch (revenues Rs1.35bn vs estimated Rs1.41bn) and EBITDA margins (9.2% vs. est. of 10.6%).

n     Order book at Rs4.4bn (7938MVA) is up 1% yoy. Order inflows are healthy at Rs1.5bn, up 5% yoy and 53% qoq. However, mgmt continues to highlight competition in the sector.

n     Has built in 10%/11% EBITDA margins in FY12E/FY13E. Considering - (1) 1H margins are at 9.3%, (2) healthy order inflows and (3) 2H is normally better - we retain our estimate.

n     Might see continued pressure in nos. for 2-3 qtrs. But looking at Voltamp’s track record, do not see significant downside in stock which is trading at near 1yr fwd book. Maintain ‘Hold’          

 

Regards,

Amit Golchha

Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com | Email : amit.g...@emkayglobal.com

Board No. : +91-22-66121212 | Extn. : 408 | DID : 66242408 | Mob : +919833357365 |

 

 

Eicher Motors Ltd.

In line, Downgrade to ACCUMULATE

 

ACCUMULATE

 

CMP: Rs 1,709                                       Target Price: Rs 1,975

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n     Results in line with EBIDTA/PAT at Rs 1.5bn/737mn vs est. of Rs 1.4bn/720mn. While two wheeler business disappointed, CV business surprised positively

n     Demand for EIM’s product continues to remain strong. However, macro environment for M&HCV is deteriorating. The impact, if any to be visible after two quarters

n     Raise our CY11/12 EPS by 8%/16% to factor in higher volumes (+5%/4.8%) and lower RM cost. See downside risk to vol. est. due to macro environment/capacity constraints

n     Upgrade TP to Rs 1,975, (current business value – Rs 1,822, NPV of engine business – Rs 153). However, downgrade rating to ACCUMULATE

 

Regards,

Chirag Shah

Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com | Email : chira...@emkayglobal.com

Board No. : +91-22-66121212 | Extn. : 252 | DID : 66121252 | Mob : +919820580701 |