Stocks in the news:
1.HUL: HUL is likely to witness 13.2% sales growth mainly on account of consolidation of acquired horlicks and boost brand. Home care and personal & beauty care businesses would see flat sales during the quarter. We believe intermediate & localised lockdowns in July would have impacted growth. Though rural sales has been growing strongly, urban sales has been impacted by down trading & shift of the migrant population to villages. Foods business is expected to grow 52% mainly due to inclusion of horlicks, boost sales. We expect 150 bps gross margin contraction due to sharp increase in tea prices. Tea prices have been up ~80% during the quarter. However, we expect lower ad spends & other cost cutting measure to result in sustainable operating margins at 25.2%. Net profit is expected to grow 7% to | 1977.9 crore
2. HDFC Life: HDFC Life reported strong premium growth at | 10183 crore, up 35% YoY, led by traction in single premium. Subsequently, APE increased by 21% YoY to | 2136 crore. Strong growth in premiums led 47% YoY NBP growth to | 5872 crore. In terms of product mix, non-par products witnessed 26% YoY decline to | 551 crore while par products grew 251% YoY to | 614 crore due to introduction of a new par product called Sanchay Par Advantage. Share of protection business stood at 11.6%. Higher APE led VNB to grow 22% YoY to | 547 crore with VNB margin at 25.6%. Stable actuarial liability was offset by increase in commissions and opex which capped PAT growth to 328 crore, up 6% YoY.
3. ACC: ACC revenues for the quarter Q3CY20 grew by 0.3% YoY to |3537.3 crore led by 0.8% YoY growth in volumes. Margins for the quarter improved by 319bps YoY to 19% leading to net profit growth of 20.3% YoY to | 363.9 crore.
4.Rallis: Rallis reported topline de-growth of 3% YoY to | 725 crore against our expectations of | 780 crore. The topline performance was remained below expectations owing to poor sales from international market, which was down by 29% YoY. On the other side, domestic agrochemical business registered a growth of 8% YoY, while the seed business grew by 29% YoY. We believe the growth from international market was partly impacted by realisation pressure in metribuzin along with lower offtake of PEKK under CRAMS portfolio. Better gross margins (+201 bps YoY) negated unabsorption of fixed overheads, resulting into OPM expansion marginally by 30bps YoY to 16.1%. EBITDA fell by 1.6% YoY to | 116.8 crore. PAT was down 4% YoY to | 81.3 crore against our estimates of | 111 crore
5.Tata Metaliks: Tata Metaliks reported healthy set of numbers for Q2FY21. Topline came in at | 520 crore, up 2% YoY , while EBITDA came in at | 109 crore, higher by 167% YoY. EBITDA margin came in at 21.1% as compared to 8.0% in Q2FY20 and 4.9% in Q1FY21. The ensuing PAT came in at | 82 crore,up 248% YoY.
6.HZL: We expect Hindustan Zinc (HZL) to report zinc sales of ~185400 tonne (up 10.4% YoY, 13.8% QoQ), lead sales of 60125 tonne (up 36.6% YoY, 33.6% QoQ) and silver sales of ~195000 k g (up 44.4% YoY, 33.6% QoQ). HZL's topline is likely to increase 25.7% YoY, 42.1% QoQ to | 5668 crore, EBITDA is likely to increase 43.2% YoY and 92.3% QoQ to | 3031 crore while PAT is likely to increase 3.1% YoY, 57.9% QoQ to | 2145 crore
7. JSW Steel: The National Company Law Tribunal (NCLT) has given JSW Steel approval to acquire bankrupt steel company Asian Colour Coated Ispat. JSW Steel has offered over ₹1550 crore for the 1 million tonne steel plant. The bid includes a ₹1,525 crore upfront payment to lenders and another ₹25 crore payment to operational creditors. On 30 June, 2019, the committee of creditors accepted accepted JSW's bid through a majority vote
1.HUL: HUL is likely to witness 13.2% sales growth mainly on account of consolidation of acquired horlicks and boost brand. Home care and personal & beauty care businesses would see flat sales during the quarter. We believe intermediate & localised lockdowns in July would have impacted growth. Though rural sales has been growing strongly, urban sales has been impacted by down trading & shift of the migrant population to villages. Foods business is expected to grow 52% mainly due to inclusion of horlicks, boost sales. We expect 150 bps gross margin contraction due to sharp increase in tea prices. Tea prices have been up ~80% during the quarter. However, we expect lower ad spends & other cost cutting measure to result in sustainable operating margins at 25.2%. Net profit is expected to grow 7% to | 1977.9 crore
2. HDFC Life: HDFC Life reported strong premium growth at | 10183 crore, up 35% YoY, led by traction in single premium. Subsequently, APE increased by 21% YoY to | 2136 crore. Strong growth in premiums led 47% YoY NBP growth to | 5872 crore. In terms of product mix, non-par products witnessed 26% YoY decline to | 551 crore while par products grew 251% YoY to | 614 crore due to introduction of a new par product called Sanchay Par Advantage. Share of protection business stood at 11.6%. Higher APE led VNB to grow 22% YoY to | 547 crore with VNB margin at 25.6%. Stable actuarial liability was offset by increase in commissions and opex which capped PAT growth to 328 crore, up 6% YoY.
3. ACC: ACC revenues for the quarter Q3CY20 grew by 0.3% YoY to |3537.3 crore led by 0.8% YoY growth in volumes. Margins for the quarter improved by 319bps YoY to 19% leading to net profit growth of 20.3% YoY to | 363.9 crore.
4.Rallis: Rallis reported topline de-growth of 3% YoY to | 725 crore against our expectations of | 780 crore. The topline performance was remained below expectations owing to poor sales from international market, which was down by 29% YoY. On the other side, domestic agrochemical business registered a growth of 8% YoY, while the seed business grew by 29% YoY. We believe the growth from international market was partly impacted by realisation pressure in metribuzin along with lower offtake of PEKK under CRAMS portfolio. Better gross margins (+201 bps YoY) negated unabsorption of fixed overheads, resulting into OPM expansion marginally by 30bps YoY to 16.1%. EBITDA fell by 1.6% YoY to | 116.8 crore. PAT was down 4% YoY to | 81.3 crore against our estimates of | 111 crore
5.Tata Metaliks: Tata Metaliks reported healthy set of numbers for Q2FY21. Topline came in at | 520 crore, up 2% YoY , while EBITDA came in at | 109 crore, higher by 167% YoY. EBITDA margin came in at 21.1% as compared to 8.0% in Q2FY20 and 4.9% in Q1FY21. The ensuing PAT came in at | 82 crore,up 248% YoY.
6.HZL: We expect Hindustan Zinc (HZL) to report zinc sales of ~185400 tonne (up 10.4% YoY, 13.8% QoQ), lead sales of 60125 tonne (up 36.6% YoY, 33.6% QoQ) and silver sales of ~195000 k g (up 44.4% YoY, 33.6% QoQ). HZL's topline is likely to increase 25.7% YoY, 42.1% QoQ to | 5668 crore, EBITDA is likely to increase 43.2% YoY and 92.3% QoQ to | 3031 crore while PAT is likely to increase 3.1% YoY, 57.9% QoQ to | 2145 crore
7. JSW Steel: The National Company Law Tribunal (NCLT) has given JSW Steel approval to acquire bankrupt steel company Asian Colour Coated Ispat. JSW Steel has offered over ₹1550 crore for the 1 million tonne steel plant. The bid includes a ₹1,525 crore upfront payment to lenders and another ₹25 crore payment to operational creditors. On 30 June, 2019, the committee of creditors accepted accepted JSW's bid through a majority vote