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June 2022

Realty Stocks Rise Up to 6% on RBI Rate Cut Hopes; Sobha and DLF Lead Surge
Business, Markets, Result Updates - August 10, 2022

Ajmera Realty reported total revenue of Rs. 55 Cr. in Q1 FY23.

Ajmera Realty reported total revenue of Rs. 55 Cr. in Q1 FY23.

Ajmera Realty reported its total revenue of Rs. 55 Cr. in Q1 FY23, down from Rs. 135 Cr. in Q1 FY22 and Rs. 181 Cr. in Q4 FY23. The current quarter’s PAT was Rs. 12 Cr., compared to Rs. 14 Cr. in the previous quarter and Rs. 10 Cr. in June 2021.EBITDA was at Rs. 18 Cr. compared to 40 Cr. in March 2022. This was due to head winds from higher input costs, revisions in interest rates, and other economic challenges. The company has maintained its margin above 9.5% on a PAT basis.

There was a decrease in debt by 25 CR in the quarter Q1 FY23 due to traction in sales, and the firm has no outstanding debt. The cost of debt has risen by 40 basis points to 11.6 percent, and the net equity ratio in the current quarter is 1.128 percent of net worth, compared to 1.18 percent in March 2022.The volume has increased to 1,574, 438 square feet, and the sales value is at Rs.400 Cr. The collection has improved from 93 Cr. in March 2022 to Rs. 210 in June 2022.

High Demand due to WFH culture:

The company witnessed a strong performance with the launch of two projects and expects to generate revenue in the coming quarters as they are in advanced stages. Overall, real estate has witnessed a resilient performance due to upward pressure in all commodities. For the first time, buyers have improved segments in real estate. Despite the hike in interest rates, there is a bit of a slowdown, but overall there is good demand. The shift in work from home, along with demand for mid-segment to luxury housing, will drive demand for this project.

The Marquee projects of Mumbai – in Wadala have a great response with 2 towers. The company has also received permission to start its work in Juhu which the issuance of certificate for construction. They acquired land spans 1,721 sq.mt., on which a residential property with a potential carpet area of 95,000 square feet is to be built, with a sales value of Rs250 crore expected over three years at conservative price points. The infrastructure will consist of two wings with 100 units with all modern lifestyle amenities.

Valuations:

EPS was at Rs.13.2 for the company and EVEBITDA was at 16.5 times. The P/E ratio is 16.5 times. Debt to equity ratio stood at 1.22. ROCE and ROE is at 8.03% and 6.63% respectively. The script is trading at 260 down by 3.35%.

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Aarti Industries Ltd Q1 FY23 Result Updates.
Result Updates - August 9, 2022

Greenlpy Industries with a Net Income Of Rs. 455.09 Cr.

Greenply Industries with a net income to Rs. 455.09 crore.

Greenply industries have reported total income of Rs. 455.0972 crores during June 30, 2022 as compared to Rs. 451.6656 crores during the period ended March 31, 2022.The net profit was at Rs. 20.7327 crores for the period ended June 30, 2022 as against of Rs. 28.9715 crores for the period ended March 31, 2022. EBITDA stood at 40 crore in Q1 FY23 compared to Rs.45 crore in Q4 FY22.
Greenply Industries Limited has been at the front of driving innovation across its products and processes keeping the consumer safety in mind. With the accelerated transformation in the interior sector post pandemic, the company introduced its E-0 compliance “Green Platinum” which is two times as effective in fire-resistant and waterproof properties as compared to other available plywood in its range. Green Platinum is also enriching with an un-extended BWP resin depicting it two times as boiling waterproof as compared to regular fire-resistant plywood.

Remarking on the launch of the new collection range

The innovation for the core products has created products that are made to fit the evolving needs of consumers. Through extensive research on consumer behaviors, they made a product which combines fire resistant, waterproof and emission proof features thus came up with the product Green Platinum with an added feature of money back warranty. Through continuous R&D process, they came up with more eco-friendly product which will promote aesthetic living among the consumer base.
Green Platinum Plywood combines the strength of California Air Resource Board (CARB) for conforming to E-0 grade formaldehyde emission and also comes with an anti-bacterial and anti-viral coating to ensure the health and safety of every home. Greenply has also taken a leadership position in communicating the need to choose the right building material for health safe interiors through their E-0 innovation. The E-0 innovation has reached over 1 million households; however, Greenply continues to build on the awareness amongst end consumers through relevant and multiple touch points.

Valuations:

The EPS of Rs. 1.68 for the period ended June 30, 2022 as compared to Rs. 2.35 in March 31, 2022 and Rs.0.33 for the period ended June 30, 2021. EVEBITDA stood at 12.9 times. P/E ratio was at 19.8 times and 5 years P/E was at 27.3 times. The scrip closed at Rs. 179 down by 1.89% on Monday.

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Zee5 reported a net profit of Rs. 122 cr. 
Business, Markets, Result Updates - August 8, 2022

Indigo Paints revenue up from Rs.156 Cr to Rs.223.99Cr.

Indigo Paints revenue up from Rs.156 Cr. to Rs.223.99 Cr.

Indigo Paints on Friday posted its financial results for the April to June 2022 quarter, with a net profit of Rs 19.91 crore up by 71.49% in the current quarter as against Rs 11.61 crore during the previous quarter YOY. PAT margins increased to 8.87% compared to 7.30% in the first quarter of the previous fiscal year. The sales stood up by 43.56% to Rs 223.99 crore in June 2022 as against Rs 156.02 crore during June 2021. The company clocked a more than 71% jump in profit and its margin improved following price hikes during the three months. The revenue of Indigo Paints’ for June 2022 ended quarter increased over 43 % YOY to Rs 224 crore, compared to Rs Rs 156 crore in the year-ago period.
EBITDA for Q1 FY23 stood at 35.27 crore from Rs. 20.16 crore up by 75% YOY. The margins expanded to 15.75 % against 12.92% when compared to last quarter. The consistent raw material prices improved from 43.61% in March 2022 to 45.19%. It was passed to the consumers in a staggered manner, the raw material cost are stabilised and have started to cool down.

New opportunities for Indigo Paints:

The company steadily witness higher volume growth in the Emulsions segment which is the largest contributor to overall value sales, and the Premium Emulsion category in particular. The incremental price hikes affected in few selected products which was in line with the industry.
The management believes that its growth in profitability would have been significantly higher had it not indulged in high advertising and promotional spending during the Indian Premier League (IPL) season. The FY22, IPL schedule was split between April and September, whereas in the current year, it was conducted in a single phase in April and May. As they are a significant advertiser in IPL, this has resulted in a higher advertising and promotional spending in June quarter of FY23 than in FY22 by Rs 5 crore.
The firm expects a much sharper increase in profitability parameters in the future quarters with comfortable margins and stabilising input costs. The company added that the strategy of increasing the presence in the Tier-1 and Tier-2 cities is showing early indications of traction and is expected to yield results in the next 2-3 quarters.

Valuations:

EPS for the company is at Rs.19.4. P/E ratio stood at 78.8 times and 5 years P/Efor te company is 90.9 times. EVEBITDA for the company is 45.1 times. However, despite the jump in revenue, profit, and margin, Indigo Paints’ shares failed to cheer Dalal Street investors as the stock ended the session at Rs 1,552, down 2 percent from its previous close on BSE.

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Inox Leisure reported its highest ever revenue of Rs.589 Cr. in Q1FY23.
Business, Markets, Result Updates - August 5, 2022

Inox Leisure reported its highest ever revenue of Rs.589 Cr. in Q1FY23.

Inox Leisure reported its highest ever revenue of Rs.589 Cr. in Q1FY23.

In Q1, Inox Leisure reported the highest revenues of Rs. 589 crore and a profit of Rs. 74 crore. The company reported an EBITDA of Rs 130 Cr. with a footfall of 18.4 million. The year-ago quarter was affected by the second COVID wave, with Q1FY23 being the first quarter of full operations. This is largely due to the flow-through of greater revenue and the continuous benefits of cost optimization. Rentals are likely to normalise to pre-Covid levels by the end of this quarter. The company recorded its highest ever average ticket size of Rs. 229 in Q2 FY23.

 

The blockbuster movies contributed significantly to higher revenue.

The quarter witnessed chartbuster movies like RRR, KGF: Chapter 2, Vikram, Bhool Bhulaiya 2, and Doctor Strange In The Multiverse of Madness. The company saw record ticket prices and revenue. The stock recorded a big beat in 1QFY23 revenue. The company delivered its best-ever quarterly performance. The spending per head was at Rs.96 in June 2022, up by 19% from Q1 FY20. The company now operates on 692 screens across 163 multiplexes in 73 cities. The company intends to add 13 more properties and 60 screens. The advertising revenue is slowing signs of recovery.

Inox Leisure added 3 new properties in June 2022 with 17 screens each, at AIPL Joystreet, Gurugram; Orchid Mall, Kalaburagi; and Sattva Necklace Mall, Hyderabad. This indicates the company’s expansion focus and intent to reach new markets. The management is confident about the business and expects a great turnaround in the business going forward thanks to a fascinating content schedule in the upcoming quarter with releases like Laal Singh Chaddha, Raksha Bandhan, Liger, Brahmastra, and Vikram Vedha.

The outstanding box office performance was appropriately complemented by the company’s phenomenal performance across the F&B counters. The redesigned approach for F & B, supported by strategic promotions and innovations, has resulted in a soaring F & B revenue of Rs 164 Cr. INOX continued its focus on the consumer front by expanding its merchandise business, where INOX admirers can buy products and feel connected with their favourite super heroes.

 Valuations:

The EPS for the company is at Rs. 4.67 compared to Rs. -2.30 in the previous quarter. ROCE and ROE for the company are at-1.57% and -38.1%, respectively.  P/E ratio for the company is 20.17 times. While, the 5 years P/E ratio is 22.2 times and 3years P/E is at -9.50 times. The debt to equity ratio for the company is 4.26, and the return on assets is -17%. The scrip was trading at Rs. 592, down by 1.85% on Thursday.

 

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Adani Group Stocks Rally on SEBI Relief, Investors Watch Pending 22 Orders for Clarity
Result Updates - August 4, 2022

Adani Wilmar reported a net profit of Rs. 175 crore.

Adani Wilmar reported a net profit of Rs. 175 crore.

Adani Wilmar Ltd (AWL), an edible oil major, on Wednesday reported a 10% growth in consolidated net profit at Rs 193.59 crore for the quarter ended June 2022. Its PAT stood at Rs 175.70 crore in June 2021. The total revenue increased to Rs 14,783.92 crore in the Q1 FY23 from Rs 11,369.41 crore in the Q1 FY22. The company has continued to demonstrate steady growth in overall volumes, led by the food business. It is despite multiple headwinds that were witnessed during the quarter, with inflation being the major concern. The edible oil business stood at 0.70 million tonnes, posting a growth of 6% volume YOY. In value terms, sales stood at Rs 11,519 crore, up 23 per cent.

Steady growth in new products:

While a majority of FMCG products are sold through general trade, the company has seen double-digit growth in revenue through e-commerce and modern trade. The sales of new products such as Poha, Khichdi, Total Balance Oil, Soya Chunkies, etc., have doubled on a YOY basis, though on a low base.

Adani Wilmar’s collective volumes increased to 1.19 million tonnes in Q1 of FY23 compared to 1.03 million tonnes in Q1 of FY22, registering a growth of 15 per cent. Food and FMCG continued to lead the growth and now have a basket of Rs 860 crore for the June quarter, registering a growth of 66 per cent on revenues and 53 per cent on volume terms. ‘Fortune’ the flagship brand, is India’s largest selling edible oil brand. The company has 23 plants in India, located in 10 states, comprising 10 crushing units and 19 refineries.

Valuations:

Adani Wilmar’s EPS is Rs. 6.68.The P/E ratio stood at 111. Its five-year P/E ratio was 74.7.The debt to equity ratio for the company was 0.36. The EBITDA ratio was 46.4. The ROCE for the stock stood at 21.5%. The ROE was at 15.5%. The large cap company closed at Rs.694, down by 0.54% on Thursday.

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Newgen Software Wins Global Deal, Shares Surge
Business, Markets, Result Updates - August 3, 2022

Indus Towers reports weak numbers in Q1FY23.

Indus Towers reports weak numbers in Q1FY23.

The shares of Indus Towers fell harshly on August 3 after the company announced weak earnings for the quarter ended June. In the quarter, net profit fell 66% year on year to Rs 477 crore, while revenue increased only 1% to Rs 6,897 crore, and operating profit fell 34% to Rs 2,322 crore. The impact of a non-payment from one of the customers reduced operating cash flow by 60% to Rs 807 crore. While the company’s energy costs increased 5.3% and operating expenses increased by 18.2%.

Main reason for the weak performance. 

In the reported quarter, share revenue per tower fell 11.4 percent sequentially to Rs 75,688.Overall, total towers increased to 1,027 from March 2022 quarter to 186,474, which was weaker than the past performance for the company. The company had agreed to the payment plan modification of security arrangements proposed by VI promoters for clearance of the outstanding dues. Pursuant to an agreement, Vodafone has given all of its primary pledged shares in equities issued by it to be used exclusively for clearing the outstanding dues of the company. Further, Indus has a secondary pledge over Vodafone’s remaining shares and a corporate guarantee provided by Vi’s promoters which could be used. However, it is insufficient to cover the outstanding.

Their prudent accounting practise resulted in their financial performance, as they focused on bills receivables due to the financial situation of one of our major customers. The fundamentals of the business remain strong, and the successful conclusion of the 5G auctions has further improved the outlook.

Valuations:

The ROCE for the company is 25.0% and the ROE is at 33.5%. The P/E ratio is at 10.2 times and 5 years’ P/E is at 17.5 times. EPS for the company is Rs.23.7. The debt to equity ratio is at 0.89 for Indus Towers. The firm has maintained a healthy dividend payout ratio of 82.96%.

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Castrol India reported a net profit of Rs.206 crore.
Result Updates - August 3, 2022

Castrol India reported a net profit of Rs.206 crore.

Castrol India manufactures and markets automotive lubricants and specialty products. It  is one of the world’s most important lubricant manufacturers and has announced its financial results for June 2022. The company reported a net profit of Rs. 206 Cr., up by 47% compared to Rs. 140 Cr. in June 2021. The company witnessed a 40% increase in revenue from operations to Rs 1,242 Cr in Q1 June 2022 over Rs 890 Cr in Q1 June 2021.

The management said the current quarter’s performance was due to a volatile market environment where they had to balance rising input costs while maintaining an optimal price and volume mix. They were affected by price increases in the first half of the year, which enabled them to deliver a resilient performance and helped to stay ahead of June 2021, though the volumes and margins were under pressure compared to March 2022.

Upcoming threats:

The company needs to keep balancing the need to drive growth and serve customers’ needs while protecting margins as inflationary and forex pressures are likely to continue in the coming period.

An integral element of their future-ready strategy is their foray into service and maintenance with new formats such as Castrol Auto Service and Castrol Express Oil Change outlets. In addition, they will also explore collaboration with electric vehicle OEMs to supply advanced electric mobility while continuing to launch new products in the traditional lubricant space. The board of directors of the company has declared an interim dividend of Rs 3 per share, which will be paid on or before August 31, 2022.

Valuations:

The EPS for the stock is at Rs. 8.18 and the P/E ratio is at 14.0 times. The ROCE and ROE for the company are at 67.5% and 49.6%, respectively. The P/B ratio is at 6.35 times and the book value of the company is Rs.18.1. The EBITDA is 8.34 times. The company is almost debt free.

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Zomato's Q1 FY23 results improved.
Business, Equities, Result Updates - August 2, 2022

Zomato zooms up 20% after stellar Q1 performance.

Zomato zooms up 20% after stellar Q1 performance.

Zomato recorded a net loss of Rs. 186 Cr. in Q1FY23 compared to a net loss of Rs. 356 Cr. YOY. The scrip soared after the results. The revenue from operations was at Rs. 1,413 Cr., up by 67.44% versus 844.4 Cr. in June 2021 due to an increase in orders for meals from the online platform. However, the company’s adjusted revenue increased by 18% quarter on quarter and 56% year on year to Rs 1,810 Cr. in Q1FY23.Its adjusted EBITDA loss was Rs 150 Cr in the June quarter, down from Rs 220 Cr the previous quarter.

The revenue is comprised of mainstream food delivery and related fees it charges restaurants for using its platform. The total order value of all food delivery orders placed online rose for the first quarter by 41.6 % to Rs 643 Cr. YOY, with an average customer of 16.7 million. The margins were negatively impacted due to higher fuel costs and wage inflation as per the management. They also added that the monthly transacting customers were the key driver for volume growth.

The domestic food delivery industry is expected to grow three times over the next five years. With the rising order regularity and user count, we expect Zomato to have 45–50% of the market share.

Future plans for Zomato

The online food delivery company will be internally rebranded by moving to a multiple chief executive structure for its businesses that will be housed under a larger organisation called Eternal. In an internal message to employees, Deepinder Goyal said the company has matured from running a single business to running multiple and large companies. The restructuring is happening after the shareholders approved the Blinkit acquisition. Zomato currently has four companies — Zomato, Blinkit, Hyperpure, and Feeding India. Starting Monday (August 1), the company will call the larger organisation Eternal. The umbrella organisation will be called Eternal and will have four firms-Zomato, Blinkit, HyperPure, and Feeding India. Goyal hinted at a model where the company would get into other businesses.

Deepak Goyal said that there will be multiple CEOs running each other’s businesses and working as a “super-team” towards building a single, large organisation. Zomato has set aside a war chest of $1 billion to invest in multiple start-ups. Zomato has acquired a substantial stake in Mukunda, Curefit, and Magicpin. The restructuring is very important as it hints at a model where the company will do other businesses.

Valuations:

The EPS is currently RS.-0.18. The ROCE and ROE are at -10.1% and -10.2%. The large cap company closed at Rs.55.6, up by 20.9% on Tuesday. The company is also debt free, with a long-term borrowing of Rs. 30 Cr. The stock P/E is 194, which is quite expensive. The P/B ratio for the company is 2.62.

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Deepak Fertilizers and Petrochemicals reported a net profit of Rs. 434 Cr.
Markets, Result Updates - August 1, 2022

Deepak Fertilizers and Petrochemicals reported a net profit of Rs. 434 Cr.

Deepak Fertilizers and Petrochemicals reported a net profit of Rs. 434 Cr.

Deepak Fertilizers reported total revenue of Rs. 3031 Cr. in June 2022. The chemicals segment contributed around 87% of total profit. Chemicals revenue was at Rs. 1771 Cr, double from the previous year’s same quarter. The fertiliser segment’s revenues increased by 26% YOY. EBITDA margins increased from 15.2% in Q1 FY22 to 24.3% in Q1 FY23. The specialty segment portfolio grew by 321% YOY from Rs. 173 Cr. in Q1 FY22 to Rs. 729 in Q1 FY23.

Future Developments

The Greenfield ammonia plant is under development and is moving ahead as per the planned schedule. The farmer connect initiatives have increased customer experience, which will be instrumental in building market position in the crop nutrition business. The second quarter is a seasonally low period for mining activity due to the monsoon. The prices of imported Ammonium Nitrate (AN) have started to moderate. The TAN business aims to effectively compete on pricing to ensure reliability and supply security. The demand and pricing for nitric acid are relatively passive as they are typically expected during the monsoon season. The focus on customised offerings for the Solar/Steel and Parma sectors will help to gradually position Acids/IPA as a specialty chemical sector. A gradual slowdown of the raw material and ammonia prices would also help to sustain a reasonable delta for the TAN/Acid businesses.

Valuations:

EPS for the company is Rs. 36.13 compared to Rs. 23.19 in the previous quarter. The P/E ratio for the stock is at 9.15 times and 3 years’ P/E is at 7.69 times. The ROCE and ROE are 19.8% and 20.7%, respectively. The debt to equity ratio is 0.68. The interest coverage ratio is 10.5 and the dividend payout ratio is 16% for the year ending March 2022. The script closed at Rs.746, up by 4.99% or 35.50 points, which is its upper circuit. 

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TSC India Posts Strong Q1 2026 Results: Revenue and Profit Surge Fuel Optimism
Markets, Real Estate, Result Updates - August 1, 2022

Aurum Proptech will deliver a strong growth

Aurum Proptech will deliver a strong growth

Aurum Proptech recorded revenue of Rs. 14.64 Cr. in Q1 FY23 compared to NIL in Q1 FY22 and reported 8.1 Cr. in Q4 FY22 with a change of 78.9%. The company realised a loss of Rs. 6.85 Cr. in Q1 FY23 compared to a loss of Rs. 4.89 Cr. sequentially. EBITDA was at a loss of Rs. 5.69 Cr for the quarter compared to a loss of Rs. 6.22 in March 2022. Up by 9.3%, they managed to reduce their losses. The SAAS segment contributed revenue of Rs. 5.11 Cr. and the Real Estate as a Service (RAAS) contributed Rs. 9.53 Cr. The company reported other expenses of Rs. 11.27 Cr., which is a main negative point for the company.

 

Robust growth is expected from Helloworld in FY23.

Aurum Proptech now has five subsidiaries. K2V2 contributed around 9.8 Cr of the total revenue, whereas Helloworld recorded a total of 2.34 Cr. in the 15 days of its incorporation and is expected to give revenue of Rs. 15 Cr. of its own by the end of the current fiscal year. The management is optimistic about its future growth and has already tied up with the top developers. The company is operational in 15 cities and is currently mainly focused on Pune, Mumbai, Bangalore, and Delhi.

They received approval for two wholly owned subsidiaries, namely the Aurum software and solutions. The company calls for money from its rights issues by the end of FY23. We believe the stock at CMP still offers a risk-free upside of about 20% return (in three months) for any funds that do not pay any taxation on dividend income and thus offers a good special situation opportunity.

 

Valuations:

The ROE is at -6.50 % and ROCE at -9.04%. The debt to equity ratio is 0.04, which is a good sign as the company won’t have any short-term or long-term liquidity problems. The current quarter’s EPS was Rs. 1.93, with a P/E ratio of 14.74. The scrip was trading at Rs. 109 on Monday, up by 0.51 points. 

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