Nik's Diary
The Indian market opened
in the red today, mirroring SGX Nifty which is trading lower by ~0.4%. Most of
the Asian markets are trading in the negative zone with losses in the range of
0.1% to 1.6%. US markets fell on Monday as traders booked profit post the
impressive rally over the past few weeks. Dow Jones had closed above 14,000 for
the first time since October 2007. Uncertainty about the political situation in
Europe also weighed on stocks after opposition leaders called on Spanish Prime
Minister Mariano Rajoy to resign amid allegations of corruption. European
markets too fell on Monday due to concerns about the political situation in
Spain and Italy. India’s Key benchmark indices closed lower on Monday for the
third consecutive session in a row. The markets reversed intra-day gains in
late trade as European stocks fell.
Nestle acquires
minority stake in Indocon Agro and Allied Activities Private Limited
FMCG major Nestle India on
Monday said the company has inked a pact to acquire a 26% stake in Indocon Agro
and Allied Activities Pvt Ltd. In a BSE filing, the company said it “has
entered into an agreement for acquiring 26% minority stake in Indocon Agro and
Allied Activities Pvt Ltd, engaged in milk collection business in western
India”. "This business investment will contribute to creating shared value
with farmers engaged in milk,” it added. The acquisition is subject to the
parties fulfilling their respective obligations, the statement said. Apart from
milk and yogurt, Nestle sells popular products like Maggi noodles, Nescafe and KitKat chocolates in India. The company has 7,000
employees in India and its products are sold in 40 lakh outlets across the
country. Shares of Nestle India on Monday closed at Rs4,749 on the BSE, up
0.63% from their previous close. Source: Livemint
CG inks agreement with Transpower NZ Ltd
Crompton Greaves (CG)
has signed a long term supply relationship agreement with Transpower New
Zealand, owners and operators of the New Zealand national grid. With this
agreement, CG becomes the first of three preferred vendors to supply
transformersto Transpower, with the potential to scale to orders worth USD 15
million annually. The transformers are being manufactured in CG's Jakarta,
Indonesia facility. As utility companies turn to transformers that optimize the
supply of electricity and improve energy efficiency, CG's state-of-the-art,
smart grid-enabled transformers are helping them provide reliable power. A
recognition of CG's operations in South-east Asia and Australasia and its expertise
in transformer technology, this tie-up in New Zealand will boost the company's
position in the region, especially in the promisingsmart grid technologies.
Crompton Greaves, CEO and managing director Laurent Demortier said, ''I thank
Transpower for the trust placed in CG's capabilities. The long-term agreement
with Transpower is recognition of our long relationship with them. Our
expansion to 500kVtransformers for large customers in SEA built a high degree
of confidence with Transpower, and led to the inking of this agreement. This
deal serves to strengthen CG's position and will help us win new orders in this
emerging and fast-growing geography.'' The agreement will remain in force
for five years with the possibility of two extensions of two years each. This
award is the result of an intense collaboration between Transpower NZ and the
CG team which have been successfully optimised for Transpower needs.
Transpower's technical personnel and the CG team provided quality improvement
direction to CG's Indonesia factory while working closely with CG's technical
specialists to perfect transformers best-suited to serve New Zealand's
requirements. Shares of the company gained Rs 1.4, or 1.32%, to trade at
Rs 107.70. The total volume of shares traded was 127,333 at the BSE (12.17
p.m., Monday). Source: Myiris
Bank of Baroda
RU3QFY2013
For 3QFY2013, Bank of Baroda
reported subdued operating performance, as its operating income and operating
profit declined by 3.2% and 13.5% yoy, respectively. Provisioning expenses for
the bank increased by 22.6% yoy, on account of higher slippages during the
quarter and hence earnings at PBT level declined by 30.9% yoy. The bank
witnessed lower effective tax rate of 16.7% during the quarter compared to
26.6% in 3QFY2012, which limited the decline in net profit to 21.6% yoy. On the
asset quality front, the bank witnessed sequentially deterioration, gross and
Net NPA levels increased by 24.5% and 41.0% qoq, respectively, on an absolute
basis. The management has guided for asset quality pressures to continue for
next few quarters. Gross and Net NPA ratio came higher sequentially by 43bp and
30bp, respectively to 2.4% and 1.1%. The bank’s PCR dipped sequentially by
484bp to 70.9%. At the CMP, the stock is trading at valuations of 0.9x FY2014E
ABV. Source: Angel Broking
United
Spirits RU3QFY2013
United Spirits (USL) posted a 11.3%
yoy growth in top-line to `2,174cr. Overall volumes for the quarter rose
by 7% yoy and stood at 32.58 million cases. The volume growth in the prestige
and above segments stood at 29% yoy, indicating the company’s focus towards the
premium segment. OPM for the quarter stood at 11.3% up 185bp on yoy basis.
Bottom-line rose by 71.2% yoy to `81cr. Source: Angel Broking
ITNL RU3QFY2013
For 3QFY2013, on a consolidated
basis, IL&FS Transportation Networks (ITNL) posted a strong
performance at the top-line and EBITDAM fronts. However, higher interest cost
and higher tax provision led to a subdued growth at the bottom-line level. The
company reported consolidated revenue of `1,764cr (`1,268cr) in 3QFY2013,
registering a growth of 39.1% yoy, which was 12% higher than our estimate.
EBITDA margins declined sequentially by 754bp to 25.5% vs 25.3% in
3QFY2012, and against our estimate of 28%. This was mainly on account of higher
revenue contribution from the relatively low-margin E&C segment during the
quarter. ITNL’s interest cost grew by 53.3% yoy to `284cr in 3QFY2013 and was
marginally above our estimate of `280cr. On the earnings front, ITNL
reported subdued growth of 18.5% yoy to `104cr (our estimate was of `108cr) on
back of higher interest cost and tax (40%).Source:
Angel Broking
Relaxo
Footwear RU3QFY2013
Relaxo reported lower-than-expected
numbers for 3QFY2013. The revenue for the quarter grew by 9.2% yoy and stood at
`223cr, lower than our expectation of `250cr. Operating margin for the
quarter was flat yoy at 8.4%, however, it was lower than our expectation of
10.3%. Additionally, the operating margin contracted by 148bp on a qoq basis
from 9.9% in 3QFY2013 on account of higher employee cost and other expenses
(mainly advertisement expense) as a percentage of net sales. Subsequently, the
profit for the quarter stood flat yoy at `6cr, which was 49.9% lower than our
estimate of `15cr. However, we remain positive on the company with the growth
triggers in place, which include – 1) capacity expansion plan, 2) store
expansion, 3) improved sales mix and 4) brand revamping. At `755, the
stock is trading at 13.6x FY2014E earnings. Source: Angel Broking
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