MOSL: NAVNEET EDUCATION (Buy)-Growth on track across segments
​NAVNEET EDUCATION: Growth on track across segments; maintain Buy
(NELI IN, Mkt Cap USD0.5b, CMP INR157, TP INR215, 37% Upside, Buy)
Publication: Continuous growth, aided by syllabus change
The publication business grew 10% YoY in 1QFY18 despite deferment of publication of 9th grade text books in Maharashtra by the education board. Growth going forward is expected to be stronger, with likely spillover of revenue of its supplementary books in 2QFY18. The business is expected to continue benefiting from syllabus change in Maharashtra and Gujarat in FY19 as well. We expect the segment to grow 15% in FY18. Moreover, the acquisition of Indiannica Learning Private Limited is not only expected to boost CBSE revenues by strengthening current library but also help NELI to venture into newer geographies, both domestic and overseas.
Stationery: Growth to pick up after muted 1QFY18
The stationery business declined 12% YoY in 1QFY18, led by the decline in exports on account of unfavorable currency movement. However, the decline is expected to be reversed in 2QFY18 and 3QFY18, resulting in 10% growth in exports in FY18. Further, exports should witness an even distribution of growth across the remaining quarters. The domestic stationery business did not witness much traction in order book in the month of June, resulting in a flattish 1QFY18. However, with 4Q being the strongest quarter for the domestic stationery, the segment is expected to get back on track, with an expected growth of 15% in FY18.
Navneet Education Limited, formerly Navneet Publication (India) Limited, is engaged in the business of publication of education and non-education books, and manufacture of paper and non-paper stationery products. The Company's segments include Publication, Stationery and Others. Its geographical segments include North & Central America, Africa, Europe, Australia & Oceania, Rest of the World and India. It has published over 5,000 titles in English, Gujarati, Hindi, Marathi, Tamil, Urdu, and other Indian and Foreign Languages. The Company sells its products under various brands, including Navneet, Vikas, Gala, Grafalco, FfUuNn and Boss. It also publishes various titles in the Children and General books category, which are not based on syllabus, such as coloring and activity books, board books, story books, and books on health and hygiene, art and artist, cooking, mehendi and embroidery, among others. It has manufacturing facilities in Virar (near Mumbai), Guma, Dantali and Silvassa.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.