​SAIL: Operating loss increases on RM cost; Net debt will continue to rise eroding equity value; Maintain Sell
(SAIL IN, Mkt Cap USD3.7b, CMP INR57, TP INR30, 47% Downside, Sell)
SAIL's EBITDA loss increased from INR0.4b in 3QFY17 to INR2.6b in 4QFY17 (est. profit of INR0.3b) as higher raw material cost offset the benefit of higher realization and lower employee cost. Adj. loss after tax of INR7.7b (est. INR13b, due to tax credits) was down from INR7.9b in 3Q on FX gains in other income. For FY17, EBITDA improved from a loss of INR33b in FY16 to just break-even of INR0.4b. Adj. loss after tax reduced from INR38b in FY16 to INR27b in FY17.
Steel Authority of India is principally engaged in the manufacturing iron and steel, both basic and special steels, for domestic construction, engineering, power, railway, automotive and defense industries and for sale in export markets. Co. steel products includes hot metal, crude steel, pig iron, cold rolled sheets and coils, galvanized sheets, electrical sheets, structural, railway products, plates, bars and rods, stainless steel and other alloy steels. Co. operates predominantly in India.
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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