Motilal Oswal - MOSL: Morning India (13/August/21): 1. Eicher Motors (Product launches continue to be impacted due to external factors); 2. Tata Steel; 3. Pidilite Inds; 4. BPCL; 5. Coal India; 6. Hero Motocorp

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Motilal Oswal

Team Research

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MOSL: Morning India (13/August/21): 1. Eicher Motors (Product launches continue to be impacted due to external factors); 2. Tata Steel; 3. Pidilite Inds; 4. BPCL; 5. Coal India; 6. Hero Motocorp

MOrning India (13/August/21): 1. Eicher Motors (Product launches continue to be impacted due to external factors); 2. Tata Steel; 3. Pidilite Inds; 4. BPCL; 5. Coal India; 6. Hero Motocorp

Today’s top research idea

Eicher Motors: Product launches continue; Mr. Dasari (CEO of RE) resigns

EIM's performance beat was driven by VECV, while RE was in line with our estimates. Delayed product launches (first due to the second COVID wave and now due to the semiconductor shortage) have shifted the recovery timelines to 2HFY22.
Standalone gross margin declined by just 30bp YoY to 40.6% (est. 39.7%). Gross profit per unit of ~INR63k was the highest ever. Adjusted EBITDA margin fell 535bp QoQ to 17.5% (est. 18.8%) due to operating deleverage.
As per the management, demand remains good, but supply-side issues have impacted ramp-up in production and new product launches. Though it is seeing a step-by-step improvement in supply-chain issues, it expects the semi-conductor shortage to continue to impact over the next few months.
We cut our FY22E consolidated EPS by 6% to account for the delayed launch of the new Classic, while maintaining our FY23E earnings estimates. We maintain our Buy rating with a TP of INR3,250 (Mar'23E SoTP).

Piping hot news

India's factory output for the month of June grows 13.6% year-on-year

The Index of Industrial Production has risen 13.6% year-on-year for the month of June, fresh data released on August 12 showed. The IIP for the mining, manufacturing and electricity sectors for June stood at 105.5, 121.0 and 169.1, respectively. Separately released data for inflation saw a three month low, with the number for July clocking in at 5.59 percent.

13/08/2021 46 EN

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MOSL: Morning India (13/August/21): 1. Eicher Motors (Product launches continue to be impacted due to external factors); 2. Tata Steel; 3. Pidilite Inds; 4. BPCL; 5. Coal India; 6. Hero Motocorp

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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