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Showing posts from April, 2009

LIC Housing Finance

Q4 Results Update: LIC Housing Finance.
LIC Housing Finance has reported good results for the Q4 FY09 quarter.
Mortgaged loans and disbursements for FY09 grew by 26% yoy and 22% yoy respectively, disbursement for Q4FY09 grew by 21% yoy. NII for Q4FY09 stands higher by 34% yoy, the better than expected growth is attributable to improved margins and enhanced mortgage loan growth. Net profit grew by 33% yoy during Q4FY09 in light of higher processing fee contribution and lower than expected NPL provisions.

Higher growth in net profit during FY09 is mainly on the back of improved margins coupled with healthy mortgage loan growth. Improved recoveries and non-fund based income (from short term fund management activity) also supported the net profit growth.

The stock has historically traded at around 1x its adjusted book value, following concern over its asset quality. Management's cautious effort to check slippages has resulted into healthy asset quality. The superior return ratios RoA of 2…

Zee News - Q4 results Update

Result Update: Zee News.

Zee News Ltd has reported a decent set of numbers - revenue growth of 26% YoY, aided by 24% advertising revenue growth and 30% subscription revenue growth. Profitability declined 40% YoY, impacted by new launches. Revenue growth and cost containment likely to help in an adverse macro environment- FY10E.
The prospects of medium term advertising spend trends is not that optimistic, ZNL is likely better off given positioning of strong franchises in regional markets, which are likely to enjoy higher growth rates. Subscription revenues are also now getting meaningful; sustained accelerated growth in this stream will provide a counter cyclical growth opportunity.
Ahead of industry growth rates, healthy financial results and stock outperformance that are in contrast to larger broadcasting peers validate ZNL having been our only preferred pick in the segment, for the last 2Q.
At valuations of 16x FY10E EPS and 10x EBITDA,most of ZeeNews' strong prospects (28% revenue…

Tata Consultancy Services TCS

Tata Consultancy Services TCS - Results Update

TCS' Volumes de-grow by 2.7% on an organic basis; average realizations down 2% QoQ. In USD terms, the revenues de-grew by 3.4% QoQ. This was despite a contribution of about 4.49% from the CGSL consolidation. Thus, organically, revenues were lower by more than 7% QoQ.

Existing clients holding back projects, new wins along expected lines Volumes degrew as existing clients held back projects. TCS has exposure to several clients, which are facing revenue and profit falls on a yearly basis. These clients have held back most of the discretionary projects and this has increased the uncertainties for the company.

Pricing pressures continue

The management has indicated that, pricing pressures continued in 4QFY09. While clients have been demanding lower prices at the time of re-negotiation of contracts, the company has also faced several out-of-the-turn pricing negotiations. The budgets of several clients have been cut and they are looking at extra…

Gateway Distriparks GDL

Gateway Distriparks GDL - Stock Update.

Gateway Distriparks Ltd is one of the leading CFS players in the country with CFS at JNPT, Chennai, Vizag and Kochi. It also has two rail linked ICD at Garhi Hasaru near Delhi and at Ludhiana. GDL has category I rail license to run both EXIM and domestic private container trains and has 13 rakes as on date. It also runs cold chain business through Snowman Frozen Foods.

Allcargo Global logistics has Acquired 5.97% equity stake in GDL. Allcargo has acquired 6,095,223 equity shares of GDL constituting 5.97% of the total paid up capital from the open market through M/s. Sealand Terminals Pvt.Ltd., which is the wholly owned subsidiary of Allcargo. It paid Rs.300 mn for this stake. As of now the management of Allcargo has that it is purely a treasury investment and has clearly declined any synergy with GDL. As of December 2008, the promoters of GDL hold 45.6% in GDL.


At Rs.74, GDL trades at fair valuations of 1.2x book value, 8.6x earnings
and 5…

Indian Economy Update

Indian Economy Update:
February IIP fell by 1.2% YoY.
The index of industrial production (IIP) for February 2009 declined 1.2%, as compared to 9.5% growth in February 2008 on back of 1.4% and 1.6% de-growth in manufacturing and mining segments, respectively. During the same month, electricity grew by only 0.7%.
The capital goods and consumer durables witnessed growth of 10.4% and 5.7%, espectively during February 2009. However, intermediate goods, basic goods and consumer non-durables declined by 5.4%, 0.4% and 5.5%, respectively.
The cumulative growth for April-February 2008-09 stands at 2.8% over the corresponding period of the previous year. At the same time, IIP growth for January 2009 has been revised upward to 0.4% from the previously reported negative growth of 0.5%.
The recent fall in inflation would provide greater leeway to Reserve Bank of India for taking softer monetary stance, going forward.

Punj Lloyd

Punj Lloyd - Key highlights.

Progress on adjudication proceedings against SABIC.
Post termination of the contract by SABIC Petrochemicals, Simon Carves had commenced adjudication proceedings against SABIC. Earlier SABIC Petrochemicals had argued that adjudication doesn't have the jurisdiction to decide the case. But the court has overruled this and final hearing is expected by third week of April, with likely decision expected to be announced within 2-3 days after the final hearing. Since client has also revoked the performance and advance bank guarantee to the tune of Rs 2.14bn, we have written off this amount as an exceptional item in the current fiscal financials on the basis of conservative accounting policy.

Certain orders of Punj Lloyd have been facing delays since Q3FY09 due to the credit crunch. Project worth Rs 18bn related to Integrated Condensate Splitter Aromatics Complex at Jurong Island, Singapore has still not achieved financial closure and is likely to be cancelled.T…

Zee News

Zee News- well diversified, reasonable financial discipline, news genre to see healthy advertiser interest in an otherwise cautious environment.

ZNL has three driver channels - Zee Marathi, Zee Banglaand Zee News- making up close to 70% of its total advertising revenues. This reduces the risk of overdependence on one property and ensures a well diversified revenue stream, unlike other competitors in broadcasting.

Subscription revenues- 26% CAGR over FY08-10E.
Pay revenues- a counter cyclical growth opportunity, expect domestic subscriptions to grow led by increasing DTH penetration.
Going forward over FY08-10E the subscription revenues are expected to grow at a 26% CAGR. The pay revenues will likely be a strong growth driver for ZNL financials along with ad revenue contributions from existing channels.

Margins to largely hold over FY08-10E despite new investments and slowing growth. Stable ratings and breakeven of new properties may support.
Earnings growth for ZNL, is likely to be driven b…

Allcargo Global Logistics

Allcargo Global Logistics - key points.

The global recession has led to slowdown in the global trade. There has been significant slowdown in major export markets like US and Europe. Due to this the import and export activity in India has been significantly impacted. India's total exports have registered de-growth. India's exports have registered negative growth rate for four consecutive months. This has led to lower number of container handling at the Container Freight Station (CFS) facilities.

However due to liquidity crunch the importers are keeping the containers for longer durations with the CFS thereby increasing the ground rent income for the CFS players like Allcargo. This is compensating for the fall in volumes handled at the CFS.

JV with Hind terminals to ease the pressure on capex - however major benefits unlikely before H2CY10E.Allcargo is looking to set up 4 CFS / ICD facilities over next three years and it has already purchased land at Nagpur, Hyderabad, Bangalore an…