Motilal Oswal - MOSL: INDIA STRATEGY | 4QFY17 PREVIEW-The Great Divide-Earnings to bounce off a low base, but quality of growth weak

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Motilal Oswal

Gautam Duggad

MOSL: INDIA STRATEGY | 4QFY17 PREVIEW-The Great Divide-Earnings to bounce off a low base, but quality of growth weak

â€‹INDIA STRATEGY | 4QFY17 PREVIEW: The Great Divide; Earnings to bounce off a low base, but quality of growth weak

Earnings growth at 11-quarter high, but quality remains weak

â€‹Continuing the narrative of the previous quarter, earnings in 4QFY17 would be driven by the low base of a few cyclicals. MOSL universe is expected to post 11-quarter-high earnings growth of 28%. However, excluding PSU Banks, Metals and Oil & Gas, MOSL universe PAT is expected to decline 5.9% YoY. Entire YoY earnings growth of INR224b for MOSL universe in 4QFY17 would be led by PSU Banks and Metals.
We expect contribution of Global Cyclicals to increase further. Domestic Cyclicals would account for 90% of 4QFY17 MOSL universe earnings delta; Defensives would post a 6.5% YoY decline.
We cut our FY18/FY19 Sensex EPS estimates by 4% to INR1,572/INR1,904. We now expect 1% EPS decline for Sensex in FY17, followed by 20% growth in FY18 on a low base of 2HFY17.

11/04/2017 292 EN

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Motilal Oswal

Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.

Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.

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Analysts

Gautam Duggad

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MOSL: INDIA STRATEGY | 4QFY17 PREVIEW-The Great Divide-Earnings to bounce off a low base, but quality of growth weak

MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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