FREE

MOSL: Morning India (10/August/18): 1. Eicher Motors; 2. BPCL; 3. Lupin; 4. Aurobindo Pharma; 5. Page Industries; 6. Bharat Forge; 7. GSK Consumer; 8. PNB Housing

MOrning India (10/August/18): 1. Eicher Motors; 2. BPCL; 3. Lupin; 4. Aurobindo Pharma; 5. Page Industries; 6. Bharat Forge; 7. GSK Consumer; 8. PNB Housing; 9. JSPL; 10. Cummins India

 

Today’s top research idea

Eicher Motors: Strong margins in both RE and VECV

• revenue grew 27% YoY to ~INR25.5b (in-line), with EBITDA growth of 30% YoY to INR8.1 (in-line). However, low other income and high tax led to adj. PAT of INR5.8b (+22% YoY) missing our estimate of INR6.2b.
• RE's net realization improved ~1.3% QoQ. EBITDA margin expanded 90bp YoY (flat QoQ) to 32.3% (est. of 31.7%) due to operating leverage and cost-control benefits, which offset commodity cost pressures. Adj. PAT grew ~20% YoY to INR5.9b (in-line).
• VECV's realizations grew 12% QoQ (+3% YoY) to INR1.6m (est. of INR1.48m) due to a better mix and a 1.5% price hike in 1QFY19. EBITDA margin expanded 90bp YoY (-30bp QoQ) to 9.2% (est. of 8%). PAT grew 76% YoY to INR1.1b (est. of ~INR0.9b).
• Supply is now aligning with demand, with waiting period of <1 month. SSG (for >2 year old dealer) at 10%.

Piping hot news

Jet Airways defers Q1 result announcement

• Facing financial headwinds, in a rare development, Jet Airways on Thursday deferred announcing the June quarter numbers to an unspecified late date. In a BSE filing late in the evening, the Naresh Goyal-run airline, which had its AGM in earlier in the day, said the board of directors decided not to review the unaudited financial performance for the June quarter.