8 Stocks Emkay 310511

Stock Update
Emkay
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Result Update
Retail Advisory Team
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May 30, 2011
Contents
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Emkay Global Financial Services Ltd.
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January 06, 2010 | 1
Result Update
Jagran Prakashan
Mixed bag, Maintain BUY
May 30, 2011
Strong ad revenue growth of 19.7% yoy to Rs Rs1.9bn, on the
Reco
Previous Reco
Buy
Buy
CMP
Target Price
Rs120
Rs149
EPS change FY12E/13E (%)
-3.6 / -1.5
Target Price change (%)

Nifty
-4%
5,476
Sensex
18,266
Price Performance
(%)
1M
3M
Absolute
(1)
(6)
13
Rel. to Nifty
6M 12M
Source: Bloomberg
Rs
20
140
14
130
120
110
-4
100
May-10
-10
Jul-10
Sep-10
Nov-10
Jagran Prakashan (LHS)
Jan-11
Mid-Day rev. grew 7.6% yoy to Rs1.1bn for FY11. EBITDA &
PAT were lower at Rs145mn and Rs20mn, resp. Decline is

attributed to change of accounting policies to same as JPLs
Given the escalation in costs, we cut EPS est. by 3.6/1.5% for
FY12E/13E. Valuations at 15.3x/12.1 for FY12E 13E. Retain

BUY rating with revised TP of Rs 149 (earlier Rs155)
Jagran Prakashan reported better than expected results on the top line front. Revenue
growth of 19.6% yoy to Rs2826mn, driven by strong ad revenue growth coupled with
improvement in circulation and better performance from other businesses (Event, Digital
and Outdoor). EBITDA was up 12.9% yoy to Rs714mn but EBITDA margin declined by
150bps to 25.3%. Higher newsprint cost and escalation in other expenditure (higher
opex in other businesses) led to low margins during Q4FY11. PAT growth of 15.7% yoy
to Rs 420mn (our estimate of Rs433mn) was partly aided by lower tax rate of 27.9%.
JPL has announced final dividend of Rs3.5.
Strong advertisement revenue growth
Stock Details
Print Media
Sector
JAGP@IN
Bloomberg
633
Equity Capital (Rs mn)
Face Value(Rs)
316
No of shares o/s (mn)
148/104
52 Week H/L
Market Cap (Rs bn/USD mn)
38/840
Daily Avg Volume (No of sh)
104862
Daily Avg Turnover (US$mn)
0.3
Shareholding Pattern (%)

Mar -11 Dec-10 Sep-10
Promoters
52.7
55.3
55.3
FII/NRI
10.6
11.0
10.4
Institutions
17.4
18.3
18.8
7.4
6.5
3.7
11.8
8.9
11.8
Public
declined by 150bps. Led by higher raw material cost & other

expenses which escalated 34.8% yoy 13.7% yoy
Mar-11
Rel to Nifty (RHS)
Source: Bloomberg
Private Corp
EBITDA improved by 12.9% yoy, however, EBITDA margin
Revenue better than estimates but with dented margin
Relative Price Chart

150
back of improving yields. Circulation rev. up 6.3% to

Rs558mn. Other business rev. grew 47.8% to Rs292mn
Source: Capitaline
Ad revenue for the quarter stood at 1.9bn, up 19.7% yoy. It was better than our
expectations of 16% growth, led by improvement in yields . As JPL is consolidating its
position in all the markets, we expect it to post strong ad revenue for next financial also.
Mid-Day financials re-aligned as per JPLs accounting policies

JPL reported Mid-Day financials for FY11. Revenue grew by 7.6% yoy to Rs1.1bn,
driven by 6.97% growth in ad revenue and 4.4% yoy growth in circulation revenue.
EBITDA declined from Rs193mn to Rs145mn and PAT was at Rs20mn v/s 93mn in
FY10. Decline in both EBITDA and PAT is attributed to change in accounting policies to
align with JPLs accounting policy. Revenue recognition and higher provisioning for the
doubtful debts has impacted ~Rs50mn at EBITDA level. One time adjustment in
depreciation policy (changed to WDV from SLM) led to increase in depreciation cost to
Rs90mn v/s 2.7mn in FY10. JPL has also re-financed Mid-Day debt from 14% to 10%.
Other businesses on track

Event and outdoor revenues stood at Rs292mn v/s 197mn in Q4FY10. Digital revenue
grew 65.9% to Rs22mn. For FY11 Event and outdoor revenues grew 32.6% to Rs939mn
and Digital 169.3% to Rs82mn. Both outdoor and Event business reported net profit
Retain BUY rating with revised target price Rs149 (earlier Rs155)
Given the cost escalations, we cut EPS est. by 3.6/1.5% for FY12E/13E. Maintain BUY
rating on the stock with revised target price of Rs149. At CMP of Rs120, stock trades at
15.3x /12.1x our EPS estimate for FY12E/13E.
Financial Snapshot
Y/E
Net
Mar
Sales
FY10
Emkay Global Financial Services Ltd
Rs Mn
PAT
EPS
EPS
ROE
(Core)
EBITDA
(%)
(Rs)
(Rs)
% chg
(%)
P/E
EBITDA
EV/
P/BV
9419
2823
30.0
1759
5.6
92.0
28.6
21.6
13.4
6.2
FY11P
12211
3568
29.2
2078
6.6
18.2
29.8
18.2
10.9
5.4
FY12E
13786
4082
29.6
2484
7.9
19.4
28.5
15.3
9.3
4.4
FY13E
15509
4988
32.2
3132
9.9
26.1
28.2
12.1
7.5
3.4
Jagran Prakashan
Result Update
Mid-Day Financials
Rs Mn
Mid-Day
FY10
FY11P
Revenue
989.9
1,065.2
EBITDA
193.0
145.8
EBITDA%
19.5
13.7
PAT
93.4
20.6
9.4
1.9
PAT%
Quarterly financials
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
YTD11
YTD10
YoY (%)
Sales
2,363
2,698
2,769
2,860
2,826
19.6
(1.2)
11,153
9,418
18.4
Raw Material
675.8
755.7
801.2
863.4
911.1
34.8
5.5
3,331
2,736
21.8
as % of sales
28.6
28.0
28.9
30.2
32.2
29.9
29.0
319.5
347.4
353.7
363.2
365.5
1,430
1,212
13.5
12.9
12.8
12.7
12.9
12.8
12.9
735.0
693.4
705.3
736.2
835.5
2,970
2,648
31.1
25.7
25.5
25.7
29.6
26.6
28.1
Employee Cost
as % of sales
SG&A expenses
as % of sales
Total operating exp
14.4
13.7
0.6
13.5
17.9
12.2
1730.3
1796.5
1860.1
1962.9
2112.0
22.1
7.6
7731
6596
17.2
EBITDA
632.5
901.7
908.4
897.5
714.2
12.9
(20.4)
3,422
2,822
21.2
Depreciation
134.9
124.9
132.7
146.2
160.4
19.0
9.7
564.3
507.5
11.2
EBIT
497.7
776.8
775.7
751.3
553.7
11.3
(26.3)
2857
2315
23.5
Other Income
66.0
57.5
64.0
55.3
55.1
(16.5)
(0.4)
231.9
342.5
(32.3)
Interest
23.9
12.3
14.0
20.9
24.8
3.8
18.7
72.0
65.7
9.6
PBT
539.8
822.0
825.7
785.7
584.0
8.2
(25.7)
3017.4
2591.5
16.4
Tax
175.9
266.0
270.6
259.3
163.2
(7.2)
(37.1)
959.1
833.2
15.1
32.6
32.4
32.8
33.0
27.9
PAT
363.8
555.9
555.1
526.4
420.8
15.7
(20.1)
2058.3
1758.3
17.1
EPS
1.2
1.8
1.8
1.7
1.3
15.7
(20.1)
6.5
5.6
17.1
(bps)
(bps)
Effective tax rate%
Margin %
EBIDTA
26.8
33.4
32.8
31.4
25.3
(150)
(611)
30.7
30.0
71
EBIT
21.1
28.8
28.0
26.3
19.6
(147)
(667)
25.6
24.6
104
EBT
22.8
30.5
29.8
27.5
20.7
(218)
(680)
27.1
27.5
(46)
PAT
15.4
20.6
20.0
18.4
14.9
(51)
(351)
18.5
18.7
(21)
ETR
32.6
32.4
32.8
33.0
27.9
(465)
(505)
31.8
32.2
(36)
Cut in EPS estimates by 3.6/ 1.5% for FY12E/13E

With the recent spike in newsprint prices and managements guidance on expansion of
Inquilab and launch of Punjabi Jagran edition, we have cut our EBITDA margin by 123bps
for FY12E and 112bps for FY13E. We believe the margin pressure would ease post FY12E
as it would complete its lined up expansion of new editions and cost increase due to launch
of DB corps Bihar launch would also happen in FY12E.
Particulars
FY12E
Old
Revenue
EBITDA
EBITDA Margin %
Emkay Research
30 May 2011
New
FY13E
% Change
Old
New
% Change
1,357.8
1378.6
1.5
1,524.6
1550.9
1.7
418.8
408.2
-2.5
507.4
498.8
-1.7
30.8
29.6
-123 bps
33.3
32.2
-112 bps
PAT
257.5
248.4
-3.6
318.0
313.2
-1.5
EPS
8.1
7.9
-3.6
10.1
9.9
-1.5
Jagran Prakashan
Result Update
Financials
Income statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11P
FY12E
FY13E
Y/E, Mar (Rs. mn)
Net Sales
9,419
12,211
13,786
15,509
Growth (%)
FY10
FY11P
FY12E
FY13E
Equity share capital
602
633
633
633
14.4
29.6
12.9
12.5
Reserves & surplus
5,551
6,333
8,077
10,469
Raw material
2,736
3,590
3,857
4,169
Net worth
6,153
6,966
8,709
11,101
Employee cost
1,212
1,727
1,875
1,987
Loan Funds
1,214
1,794
1,594
1,194
SG&A expenses
2,648
3,327
3,971
4,365
Net deferred tax liability
580
620
620
620
Total Liabilities
7,947
9,379
10,923
12,915
Gross Block
5,635
7,245
8,335
9,425
Less: Depreciation
1,945
2,555
3,200
3,901
3,690
4,690
5,135
5,524
Total operating expenditure
6,596
8,643
9,704
10,520
EBITDA
2,823
3,568
4,082
4,988
80.1
26.4
14.4
22.2
Net block
Capital work in progress
Growth (%)
Depreciation
507
655
687
743
2,315
2,913
3,396
4,245
EBIT margin (%)
24.6
23.9
24.6
Other Income
343
256
329
66
91
72
72
EBIT
Interest expenses
Exceptional items
PBT
251
250
300
300
Investment
1,666
2,366
2,366
2,366
27.4
Current Assets
4,201
4,773
5,326
6,990
429
Inventories
533
567
617
665
1,812
2,122
2,410
2,943
25
Cash & bank balance
880
479
561
1,249
2,592
3,054
3,652
4,602
Loans & advances
717
1,376
1,459
1,754
Other current assets
Tax
833
976
1,169
1,470
Effective tax rate (%)
32.1
32.0
32.0
31.9
1,759
2,078
2,484
3,132
92.0
18.1
19.5
26.1
PAT
Growth (%)
Sundry debtors
Cash Flow
259
229
279
379
1,861
2,700
2,205
2,265
Net current assets
2,340
2,073
3,122
4,725
Total Assets
7,946
9,379
10,923
12,915
FY10
FY11P
FY12E
FY13E
Core EBITDA Margin
30.0
29.2
29.6
32.2
Net Margin
16.7
16.2
16.7
18.6
Net Current liabilities

Provisions
Ratios
Y/E, Mar (Rs. mn)
FY10
FY11P
FY12E
FY13E
PBT
2,250
2,800
3,324
4,173
507
655
687
743
66
91
72
72
Depreciation
Interest
Other Non-Cash items
Y/E, Mar
Profitability (%)
59
38
ROCE
31.4
33.3
33.0
34.5
Chg in working cap
-311
-134
-966
-915
ROE
28.6
29.8
28.5
28.2
Tax paid
-833
-976
-1,169
-1,470
RoIC
48.3
51.0
48.6
50.9
5.6
6.6
7.9
9.9
Operating Cashflow
Capital expenditure
Free Cash Flow
1,738
2,473
1,947
2,603
-459
-1,654
-1,182
-1,132
Per Share Data (Rs)

EPS (adjusted)
1,280
819
765
1,471
CEPS
7.2
8.6
10.0
12.3
Other income
343
256
329
429
BVPS
19.5
22.0
27.5
35.1
Investments
-98
-700
3.3
3.5
2.0
2.0
-214
-2,098
-853
-703
30
PER
21.6
18.2
15.3
12.1
-201
580
-200
-400
P/CEPS
-66
-91
-72
-72
Dividend paid (incl tax)
-1,233
-1,295
-740
-740
Financing Cashflow
-1,500
-776
-1,012
-1,212
24
-401
82
688
Dividend Yield (%)
Opening cash position
856
880
479
561
Gearing Ratio (x)
Closing cash position
880
479
561
1,249
Investing Cashflow
Equity Capital Raised
Loans Taken / (Repaid)
Interest Paid
Net chg in cash
DPS
Valuations (x)
16.7
13.9
12.0
9.8
P/BV
6.2
5.4
4.4
3.4
EV / Sales
4.0
3.2
2.8
2.4
13.4
10.9
9.3
7.5
2.8
2.9
1.7
1.7
0.1
0.2
0.1
0.0
-0.5
-0.3
-0.3
-2.2
EV / EBITDA
Net Debt/ Equity

Net Debt/EBIDTA
Emkay Research
30 May 2011
Jagran Prakashan
Result Update
Recommendation History: Jagran Prakashan JAGP IN

Date
Reports
Reco
CMP
Target
28/02/2011
Jagran Prakashan Management Meet Update
Buy
112
155
31/01/2011
Jagran Prakashan Q3FY11 Result Update
Buy
120
155
01/11/2010
Buy
129
155
02/08/2010
Buy
121
155
Recent Research Reports
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
23/05/2011
LMW Q4FY11 Result Update
Accumulate
2,126
2,535
19/05/2011
DB Corp Q4FY11 Result Update
Hold
240
271
18/05/2011
HT Media Q4FY11 Result Update
Buy
156
183
13/05/2011
Tulip Telecom Q4FY11 Result Update
Buy
163
218
Result Update
Shree Cement
Operating level performance in line-Maintain ACCUMULATE
May 30, 2011
n EBITDA of Rs2.96bn (+88% qoq) - in line with estimates.
Reco
Previous Reco
Accumulate
Accumulate
CMP
Target Price
Rs1,836
Rs1,960
EPS change FY11E/12E (%) NA / -85.4

NA
5,473
Nifty
18,232
Sensex
Price Performance
(%)
1M
3M
Absolute
(9)
6M 12M
(8)
(6)
Rel. to Nifty
(3)
(1)
(12)
However accelerated depreciation (on Jaipur grinding unit

capitalised in Q4FY11), drags APAT to a meager Rs102mn
n Revenues of Rs10.7bn (+13.4% yoy) came in exactly in line,
led by 6.8% revenue growth in cement revenues (Rs9.5bn)

and impressive 121% yoy growth in power revenues (Rs1.2bn)
n Upgrade FY12 EBITDA by 3.8%, but cut FY12E EPS estimates
by to EPS of Rs13.8 on account of revised depreciation

guidance. Introduce FY13 estimates with EPS of Rs175
n Change in FY12 EPS does not affect our target as its driven
by depreciation (non cash charge). Continue to value Shree

on 6X FY12 EV/E. Maintain ACCUMULATE. Target - Rs1,960
Source: Bloomberg
Q4FY11 operating performance meets expectation

2300
Rs
10
2140
1980
-6
1820
-14
1660
-22
1500
May-10
-30
Jul-10
Sep-10
Nov-10
Shree Cements (LHS)
Jan-11
Mar-11
Shrees Q4FY11 EBITDA of Rs2.96bn grew 88% qoq (-17.1% yoy), in line with
estimates , with 744bps sequential improvement in EBIDTA margins at 27.7%.
Revenues of Rs10.7bn (+13.4% yoy) came in exactly in line, led by 6.8% revenue
growth in cement division (Rs9.5bn) and impressive 121% yoy growth in power
revenues (Rs1.19bn). Cement volumes grew 7.5% yoy (2.88mnt) while realizations
though stood flat yoy, improved 15.7% sequentially. Pure Grey Cement realizations at
Rs3432/t, improved 16.2% qoq.
Rel to Nifty (RHS)
Sharp improvement in realization boost cement EBIDTA/t to Rs847
Source: Bloomberg
Stock Details
Cement
Sector
SRCM@IN
Bloomberg
348

Face Value(Rs)
10
35
2,324/1,505
52 Week H/L
64/1,420
6574
0.3
Cement EBITDA/t at Rs847, improved 52% qoq, as 16% sequential improvement in

cement realization helped protect margins against cost increases. Total cost /t of
Rs2380 increased 13% yoy led by 24% increase in higher raw material cost/t and 28%
increase in P&F costs per tonne (As Shree completely relies on imported petcoke,
prices of which have gone up by 44% yoy and 16% qoq).
2.3X jump in power volumes drives 68% jump in power EBIDTA

Power revenues grew on the back of impressive 2.3X jump in volumes (257mn units vs
78 mn sold in Q4FY10). Power volumes increased as Shree commissioned ~100 MW of
earlier in the year and as power offtake improved in the usually deficit 4Q. Power
realisation came in better than expected at Rs4.65/unit leading to power EBIDTA of
Rs520 mn, +68% yoy and up 3.3X qoq . Cost of power/unit declined 9% yoy & 7.5% qoq
with resultant EBITDA/unit at Rs2, sequential improvement of 24%.

Promoters
64.8
64.8
64.8
Accelerated depreciation drags net profit to a meager Rs102 mn
FII/NRI
16.8
17.4
16.7
Institutions
6.1
6.4
7.0
Private Corp
8.3
7.5
7.3
Public
4.0
4.0
4.2
Shrees depreciation charges jump 2x sequentially to Rs2.65bn, (higher than estimates

of Rs1.4bn) as it charged accelerated depreciation (on Jaipur grinding unit capitalised in
Q4FY11). This coupled with lower than expected other income (Rs209mn vs 428mn)
and higher assets write off (Rs343mn vs estimated 60mn) led to a APAT of just
Rs102mn, (adjusted for prior period tax of Rs555 mn). Reported net profit of Rs657mn
(-192% yoy) was lower than estimates of Rs1016m.
Source: Capitaline
Financial Snapshot
YE-
Net
Mar
Sales
(Core)
EBITDA
(%)
APAT
(Rs)
EPS
FY10
36,321
14,919
41.1
7,197
FY11P
35,118
8,857
25.2
1,506
FY12E
44,918
11,429
25.4
482
13.8
FY13E
53,713
13,842
25.8
6,109
175.4
RoE
% chg
(%)
206.6
24.5
47.3
43.2
-79.1
7.9
-68.0
2.4
1166.8
27.0
EV/
EV/
EBITDA
Tonne
8.9
4.4
126.7
42.5
7.6
103.2
132.6
5.6
90.9
10.5
3.8
61.8
P/E
Shree Cement
Result Update
Result Tables
Y/E, Mar (Rs. m)
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11P
FY10
YoY (%)
Net Sales
9,440
9,445
7,176
7,796
10,701
13.4
37.3
35,119
36,321
-3.3
Total Expenditure
31.9
24.5
26,262
20,992
25.1
75%
58%
3,723
3,238
11%
9%
-336
-197
5,871
6,550
5,749
6,221
7,742
as % of sales
62%
69%
80%
80%
72%
Consumption of RM
842
927
757
919
1,121
as % of sales
9%
10%
11%
12%
10%
Stock Adjustement
-29
-299
186
-49
-175
as % of sales
0%
-3%
3%
-1%
-2%
Purchase of traded goods
22
484
115
11
15
as % of sales
0%
5%
2%
0%
0%
408
478
491
479
537
4%
5%
7%
6%
5%
1,779
2,274
1,762
2,068
3,020
19%
24%
25%
27%
28%
Employee Cost
as % of sales
Power, Oil & Fuel
as % of sales
Freight expenses
2,043
1,783
1,639
2,016
2,313
as % of sales
22%
19%
23%
26%
22%
Other expenditure
807
903
799
777
912
as % of sales
9%
10%
11%
10%
9%
EBIDTA
3,569
2,895
1,427
1,575
2,959
Depreciation
33.1
22.0
506.3
258.4
-1%
-1%
-33.7
32.1
625
92
2%
0%
31.8
12.0
1,985
1,495
6%
4%
9,123
6,105
26%
17%
7,751
7,404
22%
20%
2,856
69.8
13.2
46.0
14.7
13.0
17.4
3,390
10%
8%
-17.1
87.8
8,857
15,329
15.0
70.9
580.4
32.8
49.4
4.7
18.7
-42.2
2,898
1,517
1,360
1,373
2,993
3.3
118.0
6,758
5,704
18.5
EBIT
671
1,378
67
203
-33
-105.0
-116.5
2,099
9,625
-78.2
Other Income
212
287
429
319
209
-1.6
-34.5
1,243
1,161
7.0
Interest
321
420
311
504
519
61.7
3.1
1,753
818
114.3
PBT
562
1,244
185
18
-344
-161.2
-2017.7
1,588
9,968
-84.1
Total Tax
330
185
80
-222
-446
-235.0
101.0
-403
2,063
-119.5
Adjusted PAT
232
1,059
106
240
102
-56.1
-57.5
1,991
7,904
-74.8
APAT after MI
232
1,059
106
240
102
-56.1
-57.5
1,991
7,904
-74.8
Extra ordinary items
946
-35
-555
-158.7
1470.4
-106
1,143
-109.3
Reported PAT
-714
1,059
106
275
657
-192.1
139.1
2,097
6,761
-69.0
Reported EPS
6.7
30.4
3.0
6.9
2.9
-56.1
-57.5
43.2
221.2
-80.5
(bps)
(bps)
37.8%
30.6%
19.9%
20.2%
27.7%
-1,015
744
25.2%
42.2%
-1,698
EBIT
7.1%
14.6%
0.9%
2.6%
-0.3%
-742
-291
6.0%
26.5%
-2,052
EBT
6.0%
13.2%
2.6%
0.2%
-3.2%
-917
-344
4.5%
27.4%
-2,292
PAT
2.5%
11.2%
1.5%
3.1%
1.0%
-151
-212
5.7%
21.8%
-1,609
58.7%
14.9%
43.0%
-1236.6%
129.6%
7,093
136,626
-25.4%
20.7%
-4,606
(Profit)/loss from JV's/Ass/MI
Margins (%)
EBIDTA
Effective Tax rate
Execution on 2x 150 MW TPP on track

Shrees power plants with capacity of 300MW (150 MW X2) at a capex of Rs12 bn is on
track for commissioning by June-11 & Sept-11. Post the completion of this project Shree
total power capacity will reach to 565 MW, out of this will 115 mw be used for the self
consumption and the rest will be available for sale.
Emkay Research
30 May 2011
Shree Cement
Result Update
Segmental Results
Segmental Results
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
Cement
8,900
8,138
6,860
7,461
9,505
Power
1,476
2,576
925
860
2,296
10,376
10,714
7,785
8,321
11,801
935
1,269
609
525
1,099
9,440
9,445
7,176
7,796
541
1,307
315
Cement
534
802
Power
-54
585
480
1,387
134
YoY (%)
QoQ (%)
FY11P
FY10
YoY (%)
6.8
27.4
31,965
34,552
-7.5
55.5
166.9
6,656
6,317
5.4
13.7
41.8
38,621
40,869
-5.5
17.5
109.5
3,502
4,547
-23.0
10,701
13.4
37.3
35,119
36,321
-3.3
335
1,196
121.3
256.9
3,154
1,770
78.2
422
882
175
-67.2
-80.2
2,281
6,286
-63.7
-288
-612
159
-394.1
-125.9
-156
3,065
-105.1
271
334
-30.5
23.3
2,125
9,351
-77.3
Revenue
Less: Intersegment revenue

Net segment revenue
Net power revenues
EBIT
EBIT margin
Cement
Power
6.0%
9.9%
6.2%
11.8%
1.8%
-69.3
-84.4
7.1%
18.2%
-1,106
-3.7%
22.7%
-31.2%
-71.1%
6.9%
-289.1
-109.7
-2.3%
48.5%
-5,086
Per tonne analysis

Per tonne analysis
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11P
FY10
YoY (%)
Cement sales (mnt)
2.68
2.49
2.28
2.62
2.88
7.5
10.1
10.26
10.26
0.0
Raw Material
314
373
332
351
389
23.8
10.8
363
316
15.0
Stocks
-11
-120
82
-19
-61
464.1
225.6
-33
-19
70.9
Employee
152
192
216
183
186
22.6
1.8
193
146
32.8
Power and fuel
578
742
718
708
814
40.9
14.9
748
539
38.7
Freight expenses
762
717
719
770
803
5.3
4.2
755
722
4.7
Freight on interunit clinker
132
149
149
153
173
30.6
12.7
157
129
21.3
Freight & Selling Expenses
630
568
570
617
630
0.0
2.1
598
592
1.0
Other exp
301
363
350
297
317
5.2
6.6
330
278
18.7
Total Cost per tonne
2,105
2,272
2,422
2,294
2,453
16.5
6.9
2,418
1,991
21.5
Realisation
3,321
3,274
3,010
2,851
3,300
-0.6
15.7
3,115
3,368
-7.5
EBIDTA
1,216
1,003
588
556
847
-30.4
52.1
697
1,377
-49.4
YoY (%)
Source: Company. Emkay Research
Power segment analysis

Power
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11P
FY10
Sales
541
825
210
335
1196
121.3
256.9
2566
1770
45.0
Realization
6.9
5.8
4.2
4.5
4.6
-33.1
2.2
4.9
6.7
-26.7
EBITDA
310
394
86
120
520
67.7
332.9
1120
1200
-6.6
EBITDA/unit
EBIDTA margin
4.0
2.8
1.7
1.6
2.0
-49.3
23.9
2.1
4.5
-52.8
57.3%
47.8%
40.8%
35.8%
43.5%
-1,387
763
43.7%
67.8%
-2,416
Source: Company
Emkay Research
30 May 2011
Shree Cement
Result Update
Upgrade FY12 EBITDA by 3.8%, but cut EPS estimates on account of revised
accelerated depreciation
On account of higher than expected FY11 exit cement prices, we upgrade our FY12
EBITDA estimates by 3.8% to Rs11.4bn. However, adjusting for revised accelerated
depreciation charges as guided by management, we cut our earnings estimates for FY12 by
85.4% to an EPS of Rs13.8 (Rs95 earlier). The accelerated depreciation in FY12 would
reduce the burden in FY13 with much lesser depreciation charges. We introduce our FY13
estimates with a EPS of Rs175. The change in earnings for FY12 does not affect our target
for Shree as earnings change in driven by higher deprecation (non cash charges ). We
continue to value Shree on 6X FY12E EV/EBITDA (currently 5.6X FY12). We maintain
ACCUMULATE rating on the stock with price target of Rs1,960.
Rs mn
Emkay Research
30 May 2011
FY12E
FY13E
Earlier
Revised
% change
Introduce
Sales
45248
44918
-0.7
53713
EBIDTA
3.8
13842
11014
11429
EBIDTA (%)
24.3
25.4
Net Profit
3314
482
-85.4
6109
EPS
95.1
13.8
-85.4
175.4
25.8
Shree Cement
Result Update
Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. m)
FY10
FY11P
FY12E
FY13E
Y/E, Mar (Rs. m)
FY10
FY11P
FY12E
FY13E
Net Sales
Growth (%)
36,321
34.0
35,118
(3.3)
44,918
27.9
53,713
19.6

Reserves & surplus
348
17,984
348
19,552
348
19,505
348
25,085
Total Expenditure
21,504
26,261
33,489
39,872
Net worth
18,332
19,900
19,853
25,433
Raw Materials Cost

Employee costs
3,238
1,586
3,722
1,983
4,349
2,181
4,800
2,399
Minority Interest
Secured Loans
17,885
16,907
15,657
14,407
Power & Fuel cost
6,105
9,125
14,555
19,017
Unsecured Loans
Freight
5,889
6,000
6,882
7,575
Loan Funds
Net Deferred Taxes
Others
4,687
4,933
5,523
6,081
EBIDTA
Growth (%)
14,919
56.9
8,857
-40.6
11,429
29.1
13,842
21.1
EBIDTA %
41.1
25.2
25.4
25.8
Depreciation
3,177
3,177
3,177
3,177
21,062
20,084
18,834
17,584
124
723
723
723
Total Liabilities
39,270
39,261
37,965
42,295
Gross Block
29,509
42,072
54,072
54,072
Less: Acc Depreciation
21,989
29,232
39,231
44,746
7,520
12,840
14,841
9,326
5,902
7,243
9,999
5,515
9,016.6
1,613.9
1,430.6
8,326.3
EBIT margin (%)

Other income
24.8
1,284
4.6
1,243
3.2
1,243
15.5
1,243
Capital WIP
Investment
9,674
15,922
9,129
11,965
3,500
11,965
3,500
11,965
Interest
1,185
1,753
2,070
1,933
Current Assets
15,822
14,412
18,491
29,905
EBT
9,116
1,103
603
7,636
Inventories
3,581
4,042
5,170
6,183
Tax
1,918
(403)
121
1,527
Sundry Debtors
824
1,082
1,384
1,655

Adj PAT
21.0
7,197
-36.5
1,506
20.0
482
20.0
6,109
Cash and Bank

Loans and Advances
4,164
7,140
4,631
4,431
7,281
4,431
17,411
4,431
Growth (%)
24.5
-79.1
-68.0
1,166.8
Net M argin (%)

19.8
4.3
1.1
11.4
Adj. PAT After JVs/Ass/MI

Extra-ordinary
7,197
437
Reported PAT
6761
2097
Growth (%)
17.0
-69.0
EBIT
1,506
(591)
Net block
112.784
224.827
224.827
224.827
Current Liab & Prov
9,666
9,084
10,832
12,401
Current liabilities
4,667
6,264
8,012
9,581
6,109
0
Provisions
Net current assets
4,999
6,156
2,820
5,328
2,820
7,659
2,820
17,505
482
6109
Miscellaneous Exps
-77.0
1,166.8
482
0
Cash Flow
Total Assets
39,272
39,261
37,965
42,295
Key Ratios
Y/E, Mar (Rs . m)
FY10
FY11P
FY12E
FY13E
FY10
FY11P
FY12E
FY13E
PBT (Ex-Other income)

Depreciation
9,313
5,704
-140
7,243
-640
9,999
6,393
5,515
Profitability (%)
EBITDA Margin
41.1
25.2
25.4
25.8
766
1,753
2,070
1,933
Net Margin
19.8
4.3
1.1
11.4
-1,286
-61
-9
1,295
0
318
0
285
ROCE
ROE
31.1
47.3
7.3
7.9
6.9
2.4
23.8
27.0
97.4
14.0
9.9
67.6
Interest Provided
Chg in working cap
Y/E, Mar
Tax paid
-1,897
403
-121
-1,527
RoIC
Operating Cashflow
12,540
10,545
11,627
12,600
Per Share Data (Rs)
-11,710
-12,018
-6,371
830
489
-1,472
1,243
5,256
1,243
12,600
1,243
-5,663
3,958
-16,885
5,200
1,243
1,243

Interest Paid
5,729
-1,332
-978
-1,753
-1,250
-2,070
-1,250
-1,933
-611
-529
-529
-529
Capital expenditure
Free Cash Flow
Other income
Investments
Investing Cashflow
Income from investments

Others
EPS
206.6
43.2
13.8
175.4
CEPS
BVPS
363.5
526.2
268.1
571.2
300.9
569.9
333.7
730.1
13.0
13.0
13.0
13.0
PER
8.9
42.5
132.6
10.5
P/CEPS
P/BV
5.1
3.5
6.8
3.2
6.1
3.2
5.5
2.5
EV / Sales
1.8
1.9
1.4
1.0
EV / EBITDA
4.4
7.6
5.6
3.8
DPS
Valuations (x)
Dividend Yield (%)
0.7
0.7
0.7
0.7
Financing Cashflow
Net chg in cash
3,786
-559
-3,260
467
-3,849
2,649
-3,712
10,131
Gearing Ratio (x)

Net Debt/ Equity
0.1
0.2
(0.0)
-0.5
4,723
4,164
4,631
7,281
Net Debt/EBIDTA
1.1
1.7
1.0
0.0
4,164
4,631
7,281
17,411
-3
-12
-12
-12
Emkay Research
30 May 2011
Working Cap Cycle (days)
10
Shree Cement
Result Update
Recommendation History: Shree Cement SRCM IN

Date
Reports
Reco
CMP
Target
31/01/2011
Shree Cement Q3FY11 Result Update
Accumulate
1,660
1,960
11/11/2010
Accumulate
2,240
2,330
17/08/2010
Accumulate
1,805
2,200
24/05/2010
Accumulate
1,990
2,354
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
27/05/2011
Aban Offshore Q4FY11 Result Update
Accumulate
541
645
26/05/2011
Century Plyboards Q4FY11 Result Update
Buy
65
75
25/05/2011
Madras Cement Q4FY11 Result Update
Accumulate
93
100
25/05/2011
IRB Infrastructure Q4FY11 Result Update
Buy
152
255
11
Taro holds the key; Maintain Hold

May 30, 2011
Reco
Previous Reco
Hold
Hold
CMP
Target Price
Rs465
Rs497
- 3 / NA
Nifty
5,473
Sensex
18,232
(%)
1M
3M
Absolute
(0)
11
42
11
33
6M 12M

Rs
30
420
20
380
10
340
300
Jun-10
-10
Oct-10
Dec-10
Sun Pharma (LHS)
n Revenue growth was led by 20% growth in domestic branded
business and 21% YoY growth in Taro. Ex-Taro, revenues

declined by 13%
n Taros contribution of 34% to the top-line at US$108mn and
PAT at US$25mn was above expectations

with a revised target price of Rs497 (22xFY13 Core EPS)
Result Highlights
40
460
Aug-10
and PAT at Rs4.43bn (up 12% YoY)
Export formulations grew 98% YoY in Q4FY11 (contributed 52%) driven by Taro
consolidation. Taro revenues grew 21% YoY to US$108mn (contributed 33%). ExTaro, revenues de-grew by 28%
Source: Bloomberg
500
at Rs14.6bn (up 32% YoY), EBITDA at Rs4.44bn (up 6% YoY)
n Taro remains the key to future performance; Maintain Hold
Price Performance
Rel. to Nifty
n Sun Pharmas Q411 was above expectations with Revenues
Jan-11
Domestic branded formulations grew 20% YoY (contributed 40%), ahead of the
industry growth rate in Q4FY11 on account of strong growth in the chronic portfolio
Operating margins at 30% expanded 280bps QoQ on account of
Apr-11
Rel to Nifty (RHS)
Source: Bloomberg
Stock Details
Sector
Pharmaceuticals
Bloomberg
SUNP@IN
1030
Face Value(Rs)
1030
52 Week H/L
511/325
Market Cap (Rs bn/USD mn) 479/10627

148531
1.5

Promoters
63.7
63.7
63.7
FII/NRI
18.5
19.1
19.1
Institutions
7.1
6.7
6.5
Private Corp
5.1
5.0
5.0
Public
5.6
5.5
5.6
Source: Capitaline
Taro consolidation Taro performed better on the operational front as it incurred

lower R&D expenses this quarter. Ex-Taro, base EBITDA margins stood at a
healthy 33% during the quarter
Remediation related cost at the companys manufacturing facilities led to 264bps
QoQ and 311bps YoY expansion in other expenses
Future growth drivers

Domestic formulations is expected to grow at 18% and operating margins are
expected to improve once the additional field force becomes productive
377 ANDA filings till date with 152 pending for approval. Management has guided for
25 ANDA filings during FY12E
MSD JV has already commenced operation with Sitagliptin & Sitagliptin+Metformin
being launched in Indian markets
Management has guided for top-line growth of 28-30% along with Rs4.5bn of capex
and 6%+ R&D spend for FY12E. We believe strong growth in FY12E will be on
account of Taro clocking sales in excess of US$400mn and 18% growth in the
domestic branded business. Ex-Taro, revenues are likely to grow by 9% in FY12E
Valuation
We expect Sun Pharma to report 23% growth in revenues in FY12E and 15% growth in
FY13E. EBIDTA margins are expected to decrease from 34.4% in FY11 to 33.2% in
FY12E and 33.9% in FY13E. Earnings will grow by 15% CAGR over FY11-13E. We
revise our target price to Rs497 (22xFY13E core earnings of Rs22.6). At CMP, the stock
trades at 23x FY12E and 20x FY13E EPS.
Financials
YE-
Net
Rs mn
EBITDA
EPS
EPS
RoE
EV/
Mar
Sales
(Core)
(%)
APAT
(Rs)
% chg
(%)
P/E
EBITDA
P/BV
FY10
40,103
13,662
34.1
12,590
12.2
(30.7)
18.1
38.2
34.9
6.2
FY11
57,214
19,672
34.4
18,161
17.5
44.2
22.0
26.5
23.6
5.1
FY12E
70,282
23,303
33.2
20,694
20.0
14.0
21.1
23.3
19.9
4.3
FY13E
80,722
27,360
33.9
23,857
23.0
15.3
20.6
20.2
16.6
3.7
12
Result Update
Sun Pharma
Sun Pharma
Result Update
Quarterly break-up
Rs mn
Revenue
Expenditure
as % of sales
Consumption of RM
as % of sales
Employee Cost
as % of sales
Other expenditure
as % of sales
EBITDA
Depreciation
EBIT
Other Income
Non-recurring income
PBT
Total Tax
Adjusted PAT
Minority Interest
APAT after MI
Q4FY10
Q1FY11
Q2FY11
Q3FY12
Q4FY12
YoY (%)
QoQ (%)
FY10
FY11
YoY (%)
11,092
13,997
13,701
16,011
14,633
31.9
(8.6)
40,103
57,214
43%
6,907
7,837
9,030
11,605
10,197
47.6
(12.1)
26,441
37,543
42%
65.9
65.6
17.7
(27.6)
10,977.3
14,606.9
27.4
25.5
119.0
(7.8)
4,007.9
7,995.6
10.0
14.0
62.3
56.0
65.9
72.5
69.7
2,662
3,357
3,794
4,324
3,132
33%
24.0
24.0
27.7
27.0
21.4
1,160
1,246
1,456
2,754
2,540
10.5
8.9
10.6
17.2
17.4
3,085
3,235
3,780
4,528
4,525
46.7
(0.1)
11,456.0
14,940.2
27.8
23.1
27.6
28.3
30.9
3.11
2.64
28.6
26.1
4,185
6,160
4,670
4,405
4,436
6.0
0.7
13,662
19,672
44%
419
402
352
805
482
14.9
(40.1)
1,533.1
2,040.6
33%
3,766
5,758
4,319
3,601
3,954
5.0
9.8
12,129
17,631
45%
138
115
924
580
1,108
705.6
90.9
1,686.2
2,727.2
62%
333.7
3,903
5,873
5,242
4,181
5,062
29.7
21.1
14,148
20,358
44%
(12)
97
172
545
22
(280.5)
(95.9)
678.6
1,284.4
89%
3,916
5,776
5,070
3,636
5,039
28.7
38.6
13,470
19,074
42%
(880.0)
(913.1)
12.2
26.4
12,590
18,161
44%
-29
133
33.7
134.4
612
3,945
5,643
5,037
3,502
4,427
99%
30%
921.0
0.0
Reported PAT
3,945
5,643
5,037
3,502
4,427
12.2
26.4
13,511
18,161
34%
Reported EPS
3.8
5.4
4.9
3.4
4.3
12.2
26.4
12.2
17.5
44%
(bps)
(bps)
Margins (%)
(bps)
EBIDTA
37.7
44.0
34.1
27.5
30.3
(741)
280
34.1
34.4
32
EBIT
33.9
41.1
31.5
22.5
27.0
(693)
453
30.2
30.8
57
EBT
35.2
42.0
38.3
26.1
34.6
(60)
848
35.3
35.6
30
PAT
35.6
40.3
36.8
21.9
30.3
(531)
839
31.4
31.7
35
Effective Tax rate
(0.3)
1.7
3.3
13.0
0.4
76
(1,259)
4.8
6.3
151
Quarterly trend
44.0
18,000
15,000
37.7
34.1
40.3
12,000
35.6
36.8
30.3
27.5
9,000
30.3
6,000
21.9
3,000
11,092
13,997
13,701
16,011
14,633
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
Sales (Rs mn)
Emkay Research
30 May 2011
EBITDA %
50
45
40
35
30
25
20
15
10
5
0
PAT %
13
Sun Pharma
Result Update
Financial Snapshot
Rs mn
FY12E
Sun Pharma
FY13E
Taro
Consol.
Sun Pharma
19,367
70,282
59,502
Taro
Consol.
21,220
80,722
Sales
50,915
EBITDA
19,236
4,067
23,303
22,479
4,881
27,360
EBITDA %
37.8%
21.0%
33.2%
37.8%
23.0%
33.9%
EBITDA % Ex -One-offs
37.8%
21.0%
33.2%
37.2%
23.0%
33.5%
PAT
17,402
3,292
20,694
19,825
4,032
23,857
EPS
16.8
3.2
20.0
19.1
3.9
23.0
Core EPS
16.8
3.2
20.0
18.7
3.9
22.6
Rs mn
FY11
FY12E
YoY %
FY13E
Formulations
51932
Domestic
23801
Taro
Ex-Taro
64070
23.4%
73406
14.6%
28087
18.0%
33278
18.5%
10,467
19,367
85.0%
21,220
9.6%
17664
16615
-5.9%
18908
13.8%
Base
10938
16615
51.9%
17929
7.9%
FTF
6726
979
API
5212
6119
17.4%
7221
18.0%
Domestic
1130
1220
8.0%
1342
10.0%
Exports
4082
4899
20.0%
5879
20.0%
Others
70
93
32.5%
95
2.0%
Total Sales
57214
70282
22.8%
80722
14.9%
EBITDA
19,672
23,303
18.5%
27,360
17.4%
34.4
33.2
EBITDA %
PAT
YoY %
33.9
18,161
20,694
14.0%
23,857
PAT %
31.7
29.4
29.6
EPS
17.5
20.0
14.0%
23.0
15.3%
PE @ CMP
26.5
23.3
20.2
Core EPS
14.1
20.0
41.5%
22.6
13.0%
PE @ CMP
32.9
23.3
20.6
15.3%
Valuation
Sun Pharma continues to remain a good long-term fundamental story in our view, however
stock valuations are likely to limit upside. We expect Sun Pharma to report 23% growth in
revenues in FY12E and 15% growth in FY13E. EBIDTA margins are expected to decrease
from 34.4% in FY11 to 33.2% in FY12E and 33.9% in FY13E. Earnings will grow by 15%
CAGR over FY11-13E. We revise our target price to Rs497 (22xFY13E core earnings of
Rs22.6). At CMP, the stock trades at 23x FY12E and 20x FY13E EPS.
Emkay Research
30 May 2011
14
Sun Pharma
Result Update
Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11
FY12E
FY13E
Y/E, Mar (Rs. mn)
FY10
FY11P
FY12E
40,103
57,214
70,282
80,722
1,036
1,036
1,036
1,036
-4.2
42.7
22.8
14.9
Reserves & surplus
77,254
93,987
110,859
130,309
26,441
10,977
37,543
14,607
46,979
18,642
53,362
22,602
Net worth
Minority Interest
78,289
1,932
95,023
8,472
111,894
9,561
131,344
10,816
SGA
9,146
11,869
15,040
16,411
Secured Loans
479
1,179
679
179
Employee Cost
4,008
7,996
9,115
10,027
Unsecured Loans
1,233
3,077
2,577
2,077
Loan Funds
Net Sales
Growth (%)
Expenditure
Raw Materials
Other Exp
2,311
3,071
4,182
4,322
EBITDA
Growth (%)
13,662
-26.8
19,672
44.0
23,303
18.5
27,360
17.4
34.1
1,533
34.4
2,041
33.2
2,557
33.9
2,871
12,129
17,631
20,746
24,489
30.2
1,686
30.8
2,727
29.5
2,932
30.3
2,807
EBITDA margin (%)

Depreciation
EBIT
EBIT margin (%)
Other Income
Interest expenses
FY13E
1,712
4,256
3,256
2,256

Total Liabilities
-890
81,042
-3,652
104,098
-3,652
121,059
-3,652
140,764
Gross Block
27,401
43,947
48,447
53,447
8,013
10,287
12,844
15,715
Net block
19,388
1,448
33,660
2,000
35,603
2,000
37,732
1,000
Investment
30,664
22,310
22,310
22,310
Current Assets
37,121
60,397
77,147
96,639
Less: Depreciation
PBT
14,148
20,358
23,678
27,296
Tax
679
1,284
1,894
2,184
Inventories
10,739
14,794
17,571
23,409
4.8
13,552
6.3
17,248
8.0
19,605
8.0
22,601
Sundry debtors
Cash & bank balance
11,748
6,073
11,716
22,162
23,193
22,197
29,060
28,599
15,570

Adjusted PAT
962
-913
-1,089
-1,256
Loans & advances
8,562
11,726
14,186
12,590
18,161
20,694
23,857
-30.7
44.2
14.0
15.3
Current liab & Prov
7,579
14,269
16,000
16,916
Net Margin (%)

E/O items
31.4
334
31.7
0
29.4
0
29.6
0
Current liabilities
Provisions
4,095
3,484
9,203
5,065
10,366
5,635
11,108
5,808
Reported PAT
13,511
18,161
20,694
23,857
-25.7
34.4
14.0
15.3
Adjusted PAT after MI

Growth (%)
Growth (%)
Cash Flow
Net current assets
29,542
46,129
61,146
79,722
Total Assets
81,042
104,098
121,059
140,764
FY10
FY11P
FY12E
FY13E
Key Ratios
Y/E, Mar (Rs. mn)
FY10
FY11P
FY12E
FY13E
Y/E, Mar
12,462
17,631
20,746
24,489
Profitability (%)
1,533
2,041
2,557
2,871
EBITDA Margin
34.1
34.4
33.2
33.9
Net Margin
31.4
31.7
29.4
29.6

Chg in working cap
0
-4,675
0
-498
0
-14,982
0
-12,174
18
18
21
22
20
21
20
21
Tax paid
-1,106
-1,284
-1,894
-2,184
RoIC
29.9
33.6
29.7
28.7
8,214
17,889
6,426
13,002
Per Share Data (Rs)
-2,920
-13,205
-4,500
-4,000
EPS
12.2
17.5
20.0
23.0
5,295
1,686
4,685
2,727
1,926
2,932
9,002
2,807
CEPS
BVPS
13.3
75.6
19.5
91.8
22.5
108.0
25.8
126.8
3.2
4.6
5.1
5.2

Depreciation
Interest Provided
Operating Cashflow
Capital expenditure
Free Cash Flow
Other income
Investments
-12,069
8,354
Investing Cashflow
-13,302
-2,123
-1,568
-1,193
ROCE
ROE
DPS
Valuations (x)
PER
38.2
26.5
23.3
20.2

Interest Paid
-77
0
2,544
0
-1,000
0
-1,000
0
P/CEPS
P/BV
34.9
6.2
23.8
5.1
20.7
4.3
18.0
3.7
-3,321
-3,347
-3,823
-4,407
EV / Sales
11.9
8.1
6.6
5.6
Others
-2,131
1,126
EV / EBITDA
34.9
23.6
19.9
16.6
Financing Cashflow
-5,529
323
-4,823
-5,407
Dividend Yield (%)
0.7
1.0
1.1
1.1
Net chg in cash

-10,618
16,690
16,089
6,073
35
22,162
6,402
22,197
Gearing Ratio (x)

Net Debt/ Equity
-0.1
-0.2
-0.2
-0.2
6,073
22,162
22,197
28,599
Net Debt/EBIDTA
-0.3
-0.8
-0.7
-0.9
Emkay Research
30 May 2011
15
Sun Pharma
Result Update
Recommendation History: Sun Pharma SUNP IN

Date
Reports
Reco
CMP
Target
01/02/2011
Sun Pharma Q3FY11 Result Update
Hold
441
460
10/11/2010
Hold
2,318
2,300
29/07/2010
Hold
1,775
1,866
08/09/2010
Sun Pharma Event Update
Hold
1,756
1,866
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
26/05/2011
Dishman Pharma Q4FY11 Result Update
Accumulate
96
125
25/05/2011
Ipca Laboratories Q4FY11 Result Update
Buy
301
409
20/05/2011
Divis Lab Q4FY11 Result Update
Buy
710
927
19/05/2011
Panacea Biotec Q4FY11 Result Update
Hold
181
185
16
Volumes witness moderation Maintain Hold

May 30, 2011
Lower volume growth in toothbrush restricts revenue growth
Reco
Previous Reco
Hold
Hold
CMP
Target Price
Rs 896
improved YoY, however declined sequentially - new launches

likely to aid further market share improvement
NA
5,473
New launches, skewed towards premium/niche category, will

Nifty
18,232
Sensex
Price Performance
(%)
1M
3M
Absolute
(0)
11
22
12
14
Rel. to Nifty
6M 12M

Rs
20
910
14
870
830
790
-4
750
Jun-10
-10
Aug-10
Oct-10
result in higher A&P spends, which along with higher tax

rates, will restrict PAT CAGR to 13% over FY11-13E
Retain FY13E earnings of Rs37.6/Share- Valuations at 24X
FY13E EPS appear fair - Maintain HOLD rating with target

price of Rs826/Share
Operational performance marginally below expectations
Source: Bloomberg
950
Moderation in volume growth- Toothpaste market shares
NA
Rs 826
at 12.6% to Rs 5.8 bn, marginally below our expectation.

APAT at Rs 1.1 bn is above our forecasts
Dec-10
Colgate-Palmolive (LHS)
Jan-11
While toothpaste continues to witness healthy growth, lower volumes in toothbrush have
restricted overall revenue growth to 12.6%, which is marginally below our expectations.
Although operational performance is not comparable YoY as 4QFY10 has accounted for
the consolidation of Professional Oral Care for the full year FY10, results indicate that
higher input costs have arrested margin expansion, despite lower A&P spends (13.8%
in 4QFY11 versus 16.1% in 4QFY10). While EBITDA margins at 21.5% and PBT growth
at 13% is below our expectations, lower-than-estimated tax provisioning has resulted
in a muted PAT growth to Rs 1.1bn, lower than our forecast of 6% decline.
Apr-11
Toothpastes continue to outperform toothbrush reports weak performance
Rel to Nifty (RHS)
Source: Bloomberg
Stock Details
Sector
Consumers
Bloomberg
CLGT@IN
136
Face Value(Rs)
136
Toothpastes continue to witness robust volume growth of 12% driven by healthy growth
in its flagship brands Colgate Dental Cream, MaxFresh, Active Salt, etc. Increasing
penetration of toothpastes (64.3%) and higher per capita consumption (127 gms/year)
are aiding healthy and sustainable growth in this segment. However, toothbrush
witnessed weak performance with volumes growing in single-digits for the quarter after
two consecutive quarters of 24% volume growth. This has resulted in moderation of
overall volume growth to 10% for the company in 4QFY11 against 12% for FY11.
996/732
Sequential dip in market shares expect new launches to provide respite
122/2,707
37606
0.7
52 Week H/L
Promoters
51.0
51.0
51.0
Market shares in toothpaste have increased by 20 bps to 53.1% YoY however, a 30

bps fall from November 2010. Market shares in toothbrush segment at 40.3% reported a
decline of 60 bps since November 2010. Nevertheless, new product launches like the
Colgate Sensitive Pro-Relief toothpaste and a similar toothbrush along with continuing
brand investments will likely result in a healthy improvement in future. With new
launches skewed towards premium/niche categories, we expect A&P spends to remain
high in the coming quarters.
FII/NRI
Expect PAT CAGR at 13%... Maintain HOLD

19.0
17.7
16.5
Institutions
7.2
7.0
7.8
Private Corp
1.4
2.8
3.3
21.4
21.5
21.5
Public
Source: Capitaline
While we forecast a moderation in overall volume growth, we expect Colgate to maintain

its leadership position in the market aided by healthy new product launches and regular
brand activation programmes. We expect the company to post PAT CAGR of 13% over
FY11-13E with unchanged FY13E earnings of Rs37.6/Share. Valuations at 24X FY13E
EPS appear fair and hence, we maintain our HOLD rating on the stock with target price
of Rs826/Share.
Financial Snapshot
Rs Mn
YE-
Net
EBITDA
EPS
EPS
RoE
Mar
Sales
(Core)
(%)
FY10
19,625
4,254
FY11E
22,206
4,507
FY12E
25,365
FY13E
28,479
EV/
APAT
(Rs)
% chg
(%)
P/E
EBITDA
P/BV
21.7
4,233
31.1
45.8
156.1
28.8
27.8
37.4
20.3
4,026
29.1
(6.4)
113.9
30.7
25.1
31.6
5,368
21.2
4,431
32.6
11.8
115.0
27.5
21.5
29.3
6,097
21.4
5,107
37.6
15.3
122.3
23.9
18.7
27.0
17
Result Update
Colgate-Palmolive
Colgate-Palmolive
Result Update
Quarterly Results
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11
FY10
YoY (%)
Net Sales
5,166
5,288
5,518
5,582
5,818
12.6
4.2
22,206
19,625
13.2
Expenditure
3,919
3,898
4,396
4,836
4,569
16.6
(5.5)
17,699
15,370
15.1
Material Cost
1,543
1,966
2,201
2,160
2,393
55.0
10.8
8,720
7,768
12.2
% of Sales
29.9
37.2
39.9
38.7
41.1
1,125 bps
243 bps
39.3
39.6
-32 bps
Employee Expenses
421
444
533
524
432
2.5
(17.6)
1,932
1,591
21.5
% of Sales
8.1
8.4
9.7
9.4
7.4
-73 bps
-196 bps
8.7
8.1
60 bps
Advertising and Promotion spends
834
694
789
1,206
804
(3.5)
(33.3)
3,493
2,994
16.7
16.1
13.1
14.3
21.6
13.8
-231 bps
-778 bps
15.7
15.3
47 bps
1,121
795
872
947
940
(16.1)
(0.7)
3,554
3,017
17.8
% of Sales
Other Expenses
% of Sales
Ebidta
Depreciation
EBIT
Other Income
Interest
21.7
15.0
15.8
17.0
16.2
-554 bps
-80 bps
16.0
15.4
63 bps
1,247
1,390
1,122
746
1,249
0.2
67.4
4,507
4,254
5.9
206
79
84
91
88
(57.3)
(3.4)
343
376
(8.8)
1,041
1,311
1,038
655
1,161
11.5
77.3
4,164
3,878
7.4
222
263
256
277
272
22.7
(1.7)
1,068
985
8.5
19
10.0
(76.8)
33
15
118.7
1,259
1,570
1,288
913
1,429
13.5
56.5
5,200
4,848
7.3
115
350
285
250
288
150.5
15.1
1,174
615
90.7
1,144
1,220
1,003
662
1,141
(0.3)
72.2
4,026
4,233
(4.9)
8.4
9.0
7.4
4.9
8.4
(0.3)
72.2
29.1
31.1
(6.4)
(bps)
(bps)
EBIDTA
24.1
26.3
20.3
13.4
21.5
-267
811
20.3
21.7
-138
EBIT
20.2
24.8
18.8
11.7
20.0
-20
823
18.8
19.8
-101
EBT
24.4
29.7
23.3
16.4
24.6
19
821
23.4
24.7
-129
PAT
22.1
23.1
18.2
11.9
19.6
-254
774
18.1
21.6
-344
9.1
22.3
22.1
27.4
20.2
1,103
-726
22.6
12.7
988
PBT
Tax
PAT
REPS
Margins (%)
Effective Tax rate
(bps)
Moderation in volume growth

20
18
16
14
12
10
8
1QFY10
2QFY10
3QFY10
4QFY10
Overall volume growth
1QFY11
2QFY11
3QFY11
4QFY11
Toothpaste volume growth
Source: Company
Emkay Research
30 May 2011
18
Colgate-Palmolive
Result Update
Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11
FY12E
FY13E
Y/E, Mar (Rs. mn)
19625
22206
25365
28479
Equity Share Capital
15.8
13.2
14.2
12.3
15370
8.3
17699
15.1
19997
13.0
Raw Materials
7768
8720
% Of Sales
39.6
39.3
Employee Cost
Net Sales
Growth
Expenses
Growth
FY10
FY11E
FY12E
FY13E
136
136
136
136
Reserves
3125
3722
4025
4370
22382
11.9
Networth
Secured Loans
3261
0
3858
0
4161
0
4506
0
9808
11047
Unsecured Loans
46
38.7
38.8
Loan Funds
46
1591
1932
2280
2509
Total Liabilities
3307
3859
4162
4507
% Of Sales
Manufacturing Expenses
8.1
644
8.7
755
9.0
840
8.8
917
Gross Block
5345
5470
5670
5918
% Of Sales
3.3
3.4
3.3
3.2
Less: Depreciation
2876
3281
3716
4165
1866
2187
2276
2522
Net Block
2469
2189
1955
1753
9.5
9.8
9.0
8.9
62
100
100
100
Selling & Distribn Expenses

% Of Sales
3502
17.8
4105
18.5
4793
18.9
5387
18.9
Investments
Current Assets
14
6097
14
7799
14
9224
14
10537
Ebidta
4254
4507
5368
6097
Inventories
1106
1201
1359
1520
Growth
54.4
5.9
19.1
13.6
Debtors
98
104
118
132
Ebidta%
21.7
20.3
21.2
21.4
Cash&Bank
3672
5275
6470
7551
Other Income
Interest
985
15
1068
33
1241
20
1465
20
Loans&Advances
Current Liabilities & Provisions
1222
5515
1219
6423
1277
7310
1334
8077
Depreciation
376
343
434
449
582
1377
1914
2460
PBT
4848
5200
6154
7094
Miscellaneous Expenditure
Tax
615
1174
1723
1986
Deferred Tax
179
179
179
179
PAT (Before EO Item)
4233
4026
4431
5107
Total Assets
3307
3859
4162
4507
Growth
43.4
-4.9
10.1
15.3
Net Margin%
21.6
18.1
17.5
17.9
E/O Item
Reported PAT
0
4233
0
4026
0
4431
0
5107
Y/E, Mar (Rs. mn)
FY10
FY11E
FY12E
FY13E
FY10
FY11E
FY12E
FY13E
Pre-Tax Profit
Depreciation
4848
376
5285
406
6154
434
7094
449
Profitability %
Ebidta Mgn
21.7
20.3
21.2
21.4
Chg in W Cap
754
471
476
468
PAT Mgn
21.6
18.1
17.5
17.9
-767
-1141
-1621
-1919
ROCE
157.8
133.1
137.7
145.2
Admin Expenses
% Of Sales
Cash Flow
Capital Work In Progress
Net Current Assets
Key Ratios
Tax Paid
Operating CashFlow
Y/E, Mar (Rs. mn)
5211
5020
5443
6091
ROE
156.1
111.3
110.5
117.8
-1121
4090
-163
4857
-200
5243
-248
5844
Per Share Data

EPS
31.1
29.1
32.6
37.6
173
CEPS
33.9
32.1
35.8
40.9
BVPS
24.0
28.4
30.6
33.1
-1
-45
DVPS
20.0
22.0
26.0
30.0
-3336
39
-3334
126
-4048
0
-4763
0
Valuations
PER
28.8
30.7
27.5
23.9
964
1604
1195
1081
CPER
26.4
27.9
25.1
21.9
Opening Cash Position
2511
3476
5079
6275
P/BV
37.4
31.6
29.3
27.0
Closing Cash Position
3476
5079
6275
7356
Ev/Sales
6.0
5.2
4.5
4.0
27.8
2.2
25.1
2.5
21.5
2.9
18.7
3.3
1.8
20.6
1.7
19.6
1.7
19.6
1.7
19.5
-105.2
-131.6
-150.8
-163.2
1.4
0.0
0.0
0.0
Capex
Free Cash Flow
Investments
Equity Capital
Loans
Dividend
Others
Net Change in Cash
Ev/Ebidta
Dividend Yield
Turnover X Days
Debtor TO
Inventory TO
Gearing Ratio
Net Debt/Equity
Total Debt/Equity
Emkay Research
30 May 2011
19
Colgate-Palmolive
Result Update
Recommendation History: Colgate CLGT IN

Date
Reports
Reco
CMP
Target
07/04/2011
Colgate; Consumer Sector Report
Hold
846
826
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
11/05/2011
Asian Paints Q4FY11 Result Update
Accumulate
2,697
2,923
09/05/2011
Hindustan Unilever Q4FY11 Result Update
Accumulate
284
312
02/05/2011
Marico Q4FY11 Result Update
Accumulate
136
142
02/05/2011
GCPL Q4FY11 Result Update
Accumulate
394
420
20
Reiterate BUY on compelling valuations

May 30, 2011
Q4FY11 results were in line with estimates- Revenues of
Reco
Previous Reco
Buy
Buy
CMP
Target Price
Rs 356
Rs 530
11/NA
NA
5,473
Nifty
18,232
Sensex
Price Performance
(%)
1M
3M
Absolute
(4)
60
14
50
Rel. to Nifty
6M 12M
Source: Bloomberg
Rs
60
360
48
320
36
280
24
240
12
200
Jun-10
0
Aug-10
Oct-10
Dec-10
GSFC (LHS)
strong (+320bps yoy) while fertiliser segment witnessed

margins of 21.7% against losses in previous year
Upgrade FY12E estimates by 11% to Rs 73.6 and introduce
FY13E (EPS of Rs 78.8). Company holds cash in books and

investments of Rs 150 / share (42% of cmp)
Despite expected deceleration in earnings by 18% in FY12
due to softening chemical prices, valuations remain

compelling with EV/EBITDA of 1.8x and 20% discount to BV
Jan-11
Apr-11
GSFCs Q4FY11 results were in line with our estimates. Adjusted revenues of Rs 11.1bn
(adjusted for Rs 76.2mn of subsidy received related to 1997-98), +43% yoy, were in line
with our estimates of Rs 10.8bn. Adjusted EBITDA of Rs 3.1bn, +98% yoy, was
marginally higher than our estimates of Rs 2.9bn led by higher than expected fertilizer
margins. APAT of Rs 1.95bn, +52% yoy, was marginally higher than our estimates of Rs
1.76bn. AEPS for the quarter stood at Rs 24.5, +52% yoy, and was marginally higher
than our estimates of Rs 22.1.
Rel to Nifty (RHS)
Upgrade FY12E estimates by 11%, introduce FY13E
Source: Bloomberg
Stock Details
Sector
Chemicals segment margins at 34.7% continues to remain
Strong momentum continues

400
Rs11.1bn,+43% yoy, APAT (adjusted for Rs 145 mn EO

income) of Rs 1.95bn, +52% yoy
Agri-input & Chemicals
Bloomberg
GSFC@IN
798
Face Value(Rs)
10
80
52 Week H/L
413/215
28/621
45481
0.4
We have revised our FY12E earnings estimates by 11% to Rs 73.6 (from Rs 66.3) due
to firm margins in chemicals segment in H1FY12E. Though chemical prices have
recently declined, they are still higher by ~30% yoy and spreads remain favourable. We
have also introduced FY13E estimates and expect company to post an EPS of Rs 78.8
with growth driven by higher fertiliser volumes.
Softening chemical prices to lead deceleration in earnings in FY12

It is to highlight that though we expect GSFCs earnings to decline by 18% yoy in
FY12E, it is due to decline in chemical prices. In FY11, caprolactam prices saw there
peak level (increased upto US$ 3560 / mt by Mar2011, +75% over FY10 average) and
boosted companys earnings. However prices have started softening from Q1FY12E
and margins to follow suit resulting into decline in earnings.

Promoters
37.8
FII/NRI
10.4
8.6
6.9
Institutions
26.2
26.8
28.2
9.9
10.9
10.8
15.7
15.9
16.3
Private Corp
Public
37.8
37.8
Source: Capitaline
Reiterate BUY on compelling valuations

On the valuations front, GSFC has current cash on its book of Rs 6.7 bn (84 / share)
with negligible long term debt. Further it has liquid investments of Rs 5.4 bn (Rs 68/
share). With 42% of cmp in cash and equivalents and FY12 EV/EBITDA of 1.8x, P/E of
4.8x and 20% discount to book value, we believe that the stock offers attractive
investment opportunity on compelling valuations. However due to volatile earnings
driven by unpredictable chemical prices in FY12E, we maintain our price target of Rs
530 which discounts 7.2x FY12E EPS and we reiterate our BUY recommendation.
Financial Snapshot
YE-Mar
Net
Sales
Rs Mn
EBITDA
(Core)
EPS
EPS
RoE
(%)
PAT
(Rs)
% chg
(%)
P/E
EBITDA
EV/
P/BV
FY10
40,192
4,477
11.1
2,545
31.9
(49.0)
12.5
11.1
6.8
1.3
FY11
47,095
11,259
23.9
7,131
89.5
180.2
28.6
4.0
1.9
1.0
FY12E
57,925
9,671
16.7
5,863
73.6
(17.8)
18.9
4.8
1.8
0.8
FY13E
61,577
10,478
17.0
6,277
78.8
7.1
17.2
4.5
1.3
0.7
21
Result Update
GSFC
GSFC
Result Update
Quarterly Results
Rs mn
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11
FY10
YoY (%)
Revenue
7,825
10,668
13,007
12,272
11,149
42.5
(9.2)
47,095
40,192
17.2
Expenditure
6261
8831
9834
9115
8055
28.7
(11.6)
35836
34796
3.0
76.1
86.6
21.6
(18.1)
25,827
25,422
54.8
63.3
18.5
1.1
3,207
3,019
6.8
7.5
2,641
2,902
5.6
7.2
4,161
3,453
8.8
8.6
(2.0)
11,259
5,396
as % of sales
80.0
82.8
75.6
74.3
72.3
4,530
6,223
7,366
6,727
5,511
as % of sales
57.9
58.3
56.6
54.8
49.4
Power & Fuel
678
818
792
794
803
as % of sales
8.7
7.7
6.1
6.5
7.2
Employee Cost
853
625
772
675
569
as % of sales
10.9
5.9
5.9
5.5
5.1
Other expenditure
200
1,165
905
919
1,172
as % of sales
2.6
10.9
7.0
7.5
10.5
1,564
1,836
3,172
3,157
3,093
Consumption of RM
EBITDA
Depreciation
EBIT
Other Income
Interest
PBT
Total Tax
Adjusted PAT
(33.3)
486.3
97.7
(15.7)
27.6
1.6
6.2
(9.0)
20.5
108.7
352
343
358
374
388
10.2
3.7
1,464
1,409
3.9
1,212
1,493
2,814
2,783
2,705
123.2
(2.8)
9,795
3,987
145.7
365
146
438
130
229
(37.3)
76.3
943
1,130
(16.5)
56
41
41
25
32
(43.2)
28.2
138
306
(55.0)
1,521
1,598
3,212
2,888
2,902
90.8
0.5
10,600
4,811
120.4
233
512
1,142
981
948
306.2
(3.3)
3,583
1,346
166.1
1,288
1,086
2,070
2,021
1,954
51.7
(3.3)
7,131
3,464
105.9
51.7
(3.3)
7,131
3,464
363
-920
1,288
1,086
2,070
2,021
1,954
-920
265
97
Reported PAT
368
1,086
2,070
2,286
2,051
457.3
(10.3)
7,494
2,544
194.5
Reported EPS
4.6
13.6
26.0
28.7
25.7
457.3
(10.3)
94.0
31.9
194.5
(bps)
(bps)
EBIDTA
20.0
17.2
24.4
25.7
27.7
776
202
23.9
13.4
1,048
EBIT
15.5
14.0
21.6
22.7
24.3
877
159
20.8
9.9
1,088
EBT
14.8
13.6
21.3
22.5
24.0
920
151
20.5
9.2
1,135
PAT
16.5
10.2
15.9
16.5
17.5
107
106
15.1
8.6
652
Effective Tax rate
15.3
32.0
35.6
34.0
32.7
1,732
(130)
33.8
28.0
581
APAT after MI
Margins (%)
Emkay Research
30 May 2011
105.9
(bps)
22
GSFC
Result Update
Fertiliser segment margins at 21.7% was a positive surprise

Fertiliser segment reported revenues of Rs 7.1bn (adjusted for subsidy received of Rs
76.2mn), +51% yoy, marginally ahead of our expectations of Rs 6.7bn. Adjusted EBIT of Rs
1.5bn (adjusted for subsidy received of Rs 76.2mn included in revenues and Rs 68.8mn
included in other income) was ahead of our estimates of Rs 1bn. Adjusted EBIT margin
improved 560bps qoq/2700bps yoy to 21.7% against our expectation of 15%.
Implementation of NBS last year in the complex fertilizer space has benefited all players
and their margins have increased considerably. GSFC has also benefited from its low cost
captive ammonia production.
Chemicals segment margins decline qoq- yet remain healthy

Chemicals segment revenues increased 30% yoy to Rs 4.1bn and were in line with our
estimates. Segment EBIT increased to Rs 1.4bn, 43% yoy and was marginally below our
estimates of Rs 1.6bn. EBIT margins increased to 34.7% as against 31.5% last year.
However, margins declined ~500bps qoq to 34.7% as against 39.6% because of recent
correction in caprolactam -benzene spreads (as highlighted last quarter, caprolactam benzene spreads at US$ 1,825 / mt in Q3FY11 were near their peak). We believe spread
between Caprolactam and Benzene (raw material) would decline further in Q1FY12E,
however it should remain healthy.
Caprolactam-benzene spread
US$ / mt
2500
2250
2000
1750
1500
1250
1000
750
Apr-11
Jan-11
Oct-10
Jul-10
Apr-10
Jan-10
Oct-09
Jul-09
Apr-09
Jan-09
500
Source: Fibre2Fashion, Emkay Research
FY11 achieved highest ever profit of Rs 7.1 bn driven by all time high
chemical prices and strong margins in fertiliser
GSFCs revenues increased by 17% yoy to Rs 47 bn in FY11 backed by increasing
chemical prices . Chemicals segment revenues increased by 27% yoy while fertilizers
segment revenues increased by 13% yoy. Adjusted EBITDA for the year grew by 109% yoy
to Rs 11.3bn led by improvement in margins in both the chemicals & fertilizers segment.
Fertiliser segment achieved revenues of 32 bn while segment reported EBIT of Rs 5.7 bn,
+200% yoy with EBIT margins of 17.7% as against 6.7% previous year. Sharp improvement
in fertiliser margins was on account of ammonia cost benefit since company meets its
requirement for ammonia captively in manufacturing of complex fertiliser.
Chemical segment revenues at Rs 14.6 bn was up by 27% yoy but the segment reported
EBIT of Rs 4.8bn, +116% yoy with EBIT margins of 33%. Margins in chemicals segment
was at all time high due to extraordinarily high caprolactam prices in H2FY11.
Consequently, adjusted PAT grew by 106% yoy to Rs 7bn and AEPS for the year stood at
Rs 89.4.
Emkay Research
30 May 2011
23
GSFC
Result Update
Revision in estimates
We have revised our estimates for FY12E to reflect high chemicals prices in H1FY12E.
Though chemical prices have recently declined, they are still higher by ~30% yoy and
spreads remain favorable. Consequently, we have revised our revenue estimates for
FY12E by 18% and our PAT estimates by 11%. We have also introduced FY13E estimates
and expect company to report EPS of Rs 78.8, +7% yoy.
FY12E
Rs mn
Old
Estimates
New
Estimates
49,220
57,925
8,928
18.1
PAT
EPS
Net sales
EBITDA
EBITDA %
Emkay Research
30 May 2011
FY13E
%
Change
Introducing
Estimates
%
yoy
17.7
61,577
6.3
9,671
8.3
10,478
8.4
16.7
-144 bps
17.0
32 bps
5,285
5,863
10.9
6,277
7.1
66.3
73.6
11.0
78.8
7.1
24
GSFC
Result Update
Key Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11
FY12E
FY13E
Y/E, Mar (Rs. mn)
FY10
FY11E
FY12E
40,192
47,095
57,925
61,577
797
797
797
797
(31.7)
17.2
23.0
6.3
Reserves & surplus
20,644
27,647
32,857
38,481
35,715
25,422
35,836
25,827
48,254
35,971
51,099
38,239
Net worth
Minority Interest
21,441
0
28,444
0
33,654
0
39,278
0
Power & Fuel
3,019
3,207
3,765
4,002
Secured Loans
1,748
798
798
798
Employee Cost
2,902
2,641
2,896
3,079
Unsecured Loans
5,128
3,128
3,128
3,128
Other Exp
4,372
4,161
5,621
5,778
Loan Funds
EBITDA
Growth (%)
4,477
(47.4)
11,259
151.5
9,671
(14.1)
10,478
8.4
11.1
23.9
16.7
17.0
Depreciation
1,409
1,464
1,780
EBIT
3,067
9,795
7,891
EBIT margin (%)

Other Income
7.6
1,130
20.8
943
13.6
1,170
Net Sales
Growth (%)
Expenditure
Materials Consumed
EBITDA margin (%)
Interest expenses
6,876
3,926
3,926
3,926
Net deferred liabilities

Total Liabilities
1,497
29,814
1,497
33,867
1,497
39,077
1,497
44,701
2,000
Gross Block
32,316
34,135
38,785
41,785
8,478
Less: Depreciation
21,501
22,965
24,745
26,745
13.8
1,250
Net block
10,815
1,819
11,170
4,650
14,040
3,000
15,040
3,000
306
138
310
360
PBT
3,891
10,600
8,751
9,368
Current Assets
Tax
1,346
3,469
2,888
3,092

Adjusted PAT
34.6
2,545
32.7
7,131
33.0
5,863
33.0
6,277
Growth (%)
(49.0)
180.2
(17.8)
7.1
6.3
15.1
10.1
10.2
Adjusted PAT After JVs/Ass/MI

E/O items
2,545
-
7,131
363
5,863
-
Reported PAT
2,545
7,494
PAT after MI
2,545
7,131
Growth (%)
(49.0)
180.2
Net Margin (%)

(Profit)/loss from JVs/Ass/MI
FY13E
4,250
4,250
4,250
4,250
21,037
23,070
28,350
33,225
Inventories
6,111
5,648
8,728
9,279
Sundry debtors
Cash & bank balance
6,216
601
8,881
6,679
6,348
10,378
6,748
14,119
Loans & advances
8,109
1,862
2,896
3,079
Current lia & Prov
8,107
9,273
10,563
10,814
6,277
-
Current liabilities
Provisions
4,217
3,889
5,384
3,889
6,674
3,889
6,924
3,889
5,863
6,277
Net current assets
12,930
13,797
17,787
22,411
5,863
6,277
Misc. exp
(17.8)
7.1
29,814
33,867
39,077
44,701
FY10
FY11E
FY12E
FY13E
Cash Flow
Investments
Total Assets
Key Ratios
Y/E, Mar (Rs. mn)
FY10
FY11E
FY12E
FY13E
2,761
9,657
7,581
8,118
Profitability (%)
Depreciation
1,409
1,464
1,780
2,000
EBITDA Margin
11.1
20.0
16.7
17.0
Interest Provided
306
(692)
138
392
310
(95)
360
(95)
Net Margin
ROCE
6.3
15.5
12.2
33.7
10.1
24.8
10.2
23.2
Chg in working cap
Y/E, Mar
(6,658)
5,211
(291)
(883)
ROE
12.5
28.6
18.9
17.2
Tax paid
-1,346
-3,631
-2,888
-3,092
RoIC
15.2
47.3
39.7
37.9
Operating Cashflow
-4,220
13,231
6,397
6,409
(1,472)
-5,692
(4,650)
8,581
(3,000)
3,397
(3,000)
3,409
EPS
CEPS
31.9
49.6
89.5
88.2
73.6
95.9
78.8
103.9
Other income
1,130
943
1,170
1,250
BVPS
269.0
356.9
422.3
492.8
Investments
1,811
4.5
7.0
7.0
7.0
Investing Cashflow
2,941
943
1,170
1,250

3,636
(2,950)
11.1
7.2
4.0
4.0
4.8
3.7
4.5
3.4
Interest Paid
(306)
(138)
(310)
(360)
P/BV
1.3
1.0
0.8
0.7
(359)
(359)
(558)
(558)
EV / Sales
0.8
0.5
0.3
0.2
EV / EBITDA
6.8
1.9
1.8
1.3
0
2,971
0
-3,446
0
-868
0
-918
Dividend Yield (%)

Gearing Ratio (x)
1.3
2.0
2.0
2.0
Net chg in cash
220
6,078
3,699
3,741
Net Debt/ Equity
0.1
-0.2
-0.3
-0.4
381
601
6,679
10,378
Net Debt/EBIDTA
0.5
-0.6
-1.1
-1.4
601
6,679
10,378
14,119
73.6
70.9
52.9
54.0
Capital expenditure
Free Cash Flow

Others
Financing Cashflow
Emkay Research
30 May 2011
Per Share Data (Rs)
DPS
Valuations (x)
PER
P/CEPS
25
GSFC
Result Update
Recommendation History: Gujarat Sate Fertilisers GSFC IN

Date
Reports
Reco
CMP
Target
21/02/2011
Gujarat Sate Fertilisers Company Update
Buy
335
530
31/01/2011
Gujarat Sate Fertilisers Q3FY11 Result Update
Buy
327
530
16/12/2010
Gujarat Sate Fertilisers Company Update
Buy
349
530
22/10/2010
Gujarat Sate Fertilisers Q2FY11 Result Update
Buy
370
530
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
24/05/2011
Tata Chemicals Q4FY11 Result Update
Accumulate
352
400
12/05/2011
Deepak Fertilisers Q4FY11 Result Update
Buy
167
250
11/05/2011
Chambal Fertilisers Q4FY11 Result Update
Accumulate
81
86
02/05/2011
Rallis India Q4FY11 Result Update
Buy
1,390
1,735
26
Execution challenges persist- valuation attractive

May 30, 2011
IVRCL Q4FY11 APAT at Rs908 mn (+6.5% yoy) in line. RPAT at
Reco
Previous Reco
Buy
Buy
CMP
Target Price
Rs70
Rs 93
-9 / 0
8
5,473
Nifty
18,232
Sensex
Price Performance
(%)
1M
3M
6M 12M
Absolute
(11)
(41) (55)
Rel. to Nifty
(6)
(37) (58)
Source: Bloomberg
Adj. EBITDA at Rs2.16 bn (+11%yoy) came in line, even after a
revenue miss as margins at 10.6%( +21 bps yoy) surprised

positively
Order backlog at Rs238 bn though stands at 4.2X FY11 revenue,
40% of the backlog faces execution challenges. We cut 12E

EPS by -8.7% led by slower execution. Cut TP by 8% to Rs93
Sharp underperformance (~37% over last 6 months) already
factors in execution headwinds. Valuations at 10x (6X ex the

value of subs) seem to factor in negatives. Maintain Buy
Execution headwinds slows revenue growth to 8.7%

200
Rs642 mn, impacted by write offs & provisions. Execution

remains sluggish, revenue growth of 8.7%, below estimates
Rs
10
With ~40% of the order backlog facing execution headwinds, IVRCLs revenue grew by just
8.7% with revenues of Rs20.5 bn, below our estimate of Rs21.7 bn. Key order/project
where IVRCL is facing execution issues are
172
-6
144
-22
116
-38
88
-54
Project
Execution Issues
-70
Goa Karnataka Road Project
Land acquisition yet to be completed
Sion Panvel Road Project
Financial Closure not Done by IVR Assets * Holding
Koyna Hydro Project
Clearances yet to happen
AP Irrigations works
Continue to faces payment issues. Hence slower execution
Saudi Arabia Project
Turbulence in middle east.
60
Jun-10
Aug-10
Oct-10
Dec-10
IVRCL (LHS)
Jan-11
Apr-11
Rel to Nifty (RHS)
Source: Bloomberg
Stock Details
Sector
Construction
Bloomberg
IVRC@IN
534
Face Value(Rs)
267
52 Week H/L
194/60
19/422
1123152
2.0
EBITDA margins surprise positively -leading to in line 4Q numbers

Promoters
9.5
9.5
9.5
51.2
57.9
58.2
5.6
5.3
8.6
Private Corp
18.8
15.6
12.1
Public
14.9
11.7
11.6
FII/NRI
Institutions
The above mentioned orders constitute ~ 40% of IVRCl Rs238 bn order backlog. Though
IVRCl Asset & Holdings (IVR AH) is about to set financial closure of the Sion-Panvel
project, Goa-Karnataka Project continues to face land acquisition issues. Further though
receivables from AP Govt have significantly come down over last 12 months, the
management is still adopting prudent strategy of not ramping up execution to full throttle in
these projects. Hence we believe execution is likely to remain muted over next 2-3
quarters.
Source: Capitaline
Though IVRCLs execution remained muted during the quarter, 4Q adjusted EBIDTA
(Adjusting for a one time write offs & provision of Rs390 mn on account of doubtful debts &
uncleared cost overruns related to Jharkhand Rural Electrification works) at Rs2.16 bn
(+11% yoy), came in line with estimates, with margins at 10.55% (+21 bps yoy) surprising
positively (vs expectations of 9.7%). IVRCL reported its best quarterly margin in the last 12
quarters, due to higher proportion of execution from the high margin Buildings and
Industrial segment. With in line 4Q EBIDTA, APAT at Rs907 mn (+6.5% yoy) also came in
line with our estimates. RPAT at Rs643 mn declined 24.6% yoy.
Financial Snapshot (consolidated)
YE-
Net
EBITDA
Rs Mn
EPS
EPS
RoE
% chg
(%)
EV/
Mar
Sales
(Core)
(%)
APAT
(Rs)
EBITDA
P/BV
FY10
54,923
5,313
9.7
2,067
7.7
-11.4
11.3
P/E
9.2
6.3
1.0
FY11E
56,174
4,805
8.6
1,579
5.9
-23.6
8.2
12.0
8.0
1.0
FY12E
65,376
6,047
9.2
1,891
7.1
19.8
9.1
10.0
6.4
0.9
FY13E
73,562
6,804
9.3
2,235
8.4
18.2
9.9
8.5
6.1
0.8
Source: Emkay Research
27
Result Update
IVRCL Infrastructure & Project
IVRCL Infrastructure & Projects
Result Update
Quarterly Results
Rs mn
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11A
YoY (%)
QoQ (%)
FY11P
FY10
YoY (%)
Revenue
18870
11062
10502
14104
20516
8.7
45.5
56184
54524
3.0%
Expenditure
16920
10057
9797
12664
18351
8.5
44.9
50869
49341
3.1%
as % of sales
89.7
90.9
93.3
89.8
89.4
Consumption of RM
6847
3606
4095
5325
6907
0.9
29.7
19934
20147
-1.1%
as % of sales
36.3
32.6
39.0
37.8
33.7
Construction Expenses
3575
1901
1684
1894
4049
13.3
113.8
9529
10845
-12.1%
20.9
37.0
17432
15020
16.1%
2.6
21.6
2623
2026
29.5%
-31.7
46.5
1351
1303
3.7%
as % of sales
18.9
17.2
16.0
13.4
19.7
Masonry and Other labour
5159
3614
3033
4551
6234
as % of sales
27.3
32.7
28.9
32.3
30.4
Employee Cost
716
652
633
604
735
as % of sales
3.8
5.9
6.0
4.3
3.6
Other expenditure
624
283
352
291
426
as % of sales
3.3
2.6
3.3
2.1
2.1
1950
1005
706
1440
2165
11.0
50.3
5315
5183
2.5%
141
157
184
199
217
54.7
9.4
758
542
39.8%
1810
848
521
1241
1947
7.6
56.9
4557
4641
-1.8%
EBITDA
Depreciation
EBIT
Other Income
Interest
PBT
54
11
304
95
49
-8.6
-48.1
460
284
61.9%
525
453
480
592
656
24.9
10.9
2182
1641
33.0%
1338
406
345
744
1340
0.1
80.1
2836
3285
-13.7%
Total Tax
486
125
112
238
432
-11.0
81.9
908
1176
-22.8%
Adjusted PAT
852
281
233
506
908
6.5
79.3
1928
2109
-8.6%
Order-book backlog and Order inflow details

Order book details
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11A
% yoy
% qoq
220000.0
233750.0
233750.0
240000.0
242000.0
10.0
0.8
Order inflow
32626.8
11069.4
16754.7
16112.0
16465.7
-49.5
2.2
Revenue Booked
18876.8
11069.4
10504.7
14112.0
20565.7
8.9
45.7
233750.0
233750.0
240000.0
242000.0
237900.0
1.8
-1.7
Opening order backlog
Closing Orderbacklog
Emkay Research
30 May 2011
28
Result Update
Though Order backlog at Rs 238 bn stands at 4.2x FY11 revenues, 40% of

the backlog remains slow moving
With order inflow of Rs16.5 bn order backlog stands at Rs 238 billion, which is at 4.2x FY11
revenues . However ~40% of the order backlog which includes Rs 61bn from the
transportation vertical and Rs 27bn from AP is slow moving and face execution issues . AP
is facing execution delays due to state government finances and pending receivables.
Transportation vertical which includes road projects from IVR assets holding is facing
delays due to lack of financial closures and tardy process of land acquisition and other
clearances.
Conference call Highlights

n Management remains confident on executing all the road projects and has indicated that
the subsidiary (IVR Asset) remains well funded to meet the capex obligations of FY12E.
Also the management is confident that dilution of minority stakes in BOT SPVs will take
care of any additional equity requirement post FY12E.
n IVRCL Asset & Holdings (IVR AH) is about to see financial closure of the Sion-Panvel
project which should help company ramp up execution on the project.

n Goa-Karnataka Project continues to face land acquisition issues with only ~45% of the
land required for the project in hand. Though NHAI is pursuing the matter with the Goa
Govt, it is not sure when the entire land acquisition will be completed.
n Though receivable from AP Govt have significantly come down (Rs0.75 bn) over last 12
months, the management is still adopting prudent strategy of not ramping up execution
full throttle in these projects. Hence we believe execution is likely to remain muted over
next 2-3 quarters.
n Turbulence in Middle East has significantly impacted execution on the Saudi Arabia
project, IVRCL first major overseas project. IVRCL has not submitted performance
guarantees for the project and hence the works have been impacted. The company
expects the work to see ramp up over next 2-3 quarter.
n Though IVRCL management remains confident of pick up in the pace of execution, its
has refrained from giving any revenue guidance for FY12. Management highlighted that
the company is re-working execution plans and will be able to give revenue guidance
over next 3-6 months. The management also remains confident of holding onto EBIDTA
margins of ~10%.
Cut FY12E EPS estimates by 9%, target by 8% to Rs93

As mentioned earlier that though IVRCLs order backlog at 4.2x FY11 revenues, provides
good revenue visibility, ~40% of the order backlog is witnessing tardy progress and faces
execution headwinds , hurting that visibility. We remain skeptical on the pace of ramp up of
these projects . We also built in lower order inflow assumptions in the transportation vertical
due to aggressive competition in the road BOT space, which we believe will restrict IVRCL
AH to aggressively bid for road projects . Consequently we cut our EPS estimates by -8.7%
for FY12E and target by 8% to Rs93 (valuing core construction business at 9X FY12 PER .
We introduce our FY13E EPS at Rs8.4.
Downgrading FY11/12 EPS estimates by -1 %/-16 %
Rs mn
Sales
EBIDTA
EBIDTA (%)
Net Profit
EPS
FY12E
FY13E
Earlier
Revised
% change
Introduce
67710
65376
-3.4
73562
6263
6047
-3.4
6804
9.2
9.2
2071
1891
-8.7
2235
9.3
7.8
7.1
-8.7
8.4
Source: Emkay Research
Emkay Research
30 May 2011
29
Result Update
IVRCLs SOTP value at Rs 93

Value
per share
(Rs)
64
Valuation
Basis
Multiple (x)
Value
(Rsmn)
Construction business
FY12E, PE (x)
9.0x
17020
Hindustan Dorr Oliver
MCap
25% discount to M Cap
1866
IVR Asset Holding
MCap
25% discount to M Cap
5874
22
24760
93.0
Business
Total Fair value

Source: Emkay Research, Capitaline
Execution headwinds remain, however valuation offers comfort - BUY

Though IVRCL continue to face execution headwinds issues, we believe the 37%
underperformance of the stock over last 6 months already factors in all these issues .
Further we believe valuation at 10x its FY12E earnings, (which are expected to decline by
2% on adjusted FY11 earnings) and 6X ex the value of subs profit offers comfort. Maintain
Buy.
Emkay Research
30 May 2011
30
Result Update
Key Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. m)
FY10
FY11P
FY12E
FY13E
Y/E, Mar (Rs. m)
FY10
FY11P
FY12E
FY13E
Net Sales
Growth (%)
54923
10.3
56174
2.3
65376
16.4
73562
12.5

Reserves & surplus
534
17999
534
19340
534
21094
534
23142
Expenditure
49610
51369
59329
Materials Consumed
Construction Exp
19151
27130
19975
27299
23993
30792
66758
Networth
18533
19874
21628
23676
26997
34648
Minority Interest
Secured Loans
Employee Cost
2026
2623
12688
17548
18548
19548
2975
3347
Unsecured Loans
3445
3410
3410
3410
Other Exp
1303
EBITDA
5313
1471
1569
1765
Loan Funds
16133
20958
21958
22958
4805
6047
6804
Deferred tax liability
125
86
86
Growth (%)
86
26.0
-9.6
25.8
12.5
Total Liabilities
34791
40918
43672
46720
EBITDA %
Depreciation
9.7
543
8.6
758
9.2
910
9.3
995
Gross Block
7502
9702
10702
11702
EBIT
4770
4047
5138
5810
Less: Depreciation
1838
2662
3572
4567
EBIT margin (%)

Other income
Interest expenses
8.7
155
1681
7.2
460
2182
7.9
327
2642
7.9
368
2842
Net block
5664
7039
7130
7135

Investment
353
6138
139
6347
139
6138
139
6139
PBT
3244
2326
2823
3335
Current Assets
47005
54523
60594
66390
Total Tax
1177
747
931
1101
Inventories
10295
12428
13433
15317
36.3
32.1
33.0
33.0
Sundry debtors
19445
19298
23285
26200
2067
-11.4
1579
-23.6
1891
19.8
2234
18.1
Cash & bank balance

Loans & advances
1644
15618
1432
16201
2371
21494
676
24185
Net Margin (%)

3.8
0
2.8
0
2.9
0
3.0
1
2067
1579
1891
E/O items
Reported PAT
44
2111
0
1579
0
1891
-6.6
-25.2
Y/E, Mar (Rs. m)
FY10
Pre-tax profit
Depreciation
Interest Provided
Adjusted PAT
Growth (%)
5165
11
12
Current lia & Prov
24369
27130
30328
33083
2235
Current liabilities
23924
26728
30185
32937
0
2235
Provisions
Net current assets
445
22636
402
27393
143
30266
145
33307
19.8
18.2
Total Assets
34791
40918
43672
46720
FY11P
FY12E
FY13E
Y/E, Mar (Rs. m)
FY10
FY11P
FY12E
FY13E
3288
543
2326
758
2823
910
3336
995
Profitability (%)
EBITDA Margin
9.7
8.6
9.2
9.3
1448
2217
2642
2842
Net Margin
3.8
2.8
2.9
3.0

Chg in working cap
291
-2480
0
-4876
0
-1674
1
-4739
ROCE
ROE
14.7
11.3
11.9
8.2
12.9
9.1
13.7
9.9
Tax paid
-1293
-785
-931
-1101
RoIC
17.7
13.6
15.1
15.5
1797
-361
3769
1334
-1196
-1000
-1000
-1000
601
155
-1361
460
2769
327
334
368
Growth (%)
Cash Flow
Key Ratios
Operating cash Inflow

Capital expenditure
Free Cash Flow
Other income
Per Share Data (Rs)

EPS
7.7
5.9
7.1
8.4
10.9
69.4
8.8
74.4
10.5
81.0
12.1
88.7
PER
9.2
12.0
10.0
8.5
P/CEPS
P/BV
6.5
1.0
8.1
1.0
6.8
0.9
5.9
0.8
CEPS
BVPS
Investments
-1088
Investing Cashflow
-2284
-1000
-1000
-1000

Interest Paid
2199
-1904
4825
-2217
1000
-2642
1000
-2842
-215
-250
-187
-187
EV / Sales
0.6
0.7
0.6
0.6
20
EV / EBITDA
6.3
8.0
6.4
6.1
Dividend Yield (%)
1.4
1.4
1.4
2.8
101
600
2358
-212
-1829
940
-2030
-1696
Gearing Ratio (x)

Net debt/ Equity
0.8
1.0
0.9
0.9
945
1644
1432
2371
Net Debt/EBIDTA
1644
1432
2371
676

Others
Financing Cashflow
Net chg in cash
Emkay Research
30 May 2011
DPS
Valuations (x)
2.7
4.1
3.2
3.3
38.7
37.4
37.4
43.4
31
Result Update
Recommendation History: IVRCL Infrastructure & Projects IVRC IN

Date
Reports
Reco
CMP
Target
15/02/2011
IVRCL Infrastructure Q3FY11 Result Update
Buy
72
101
15/11/2010
IVRCL Q2FY11 Result Update
Hold
139
160
10/08/2010
Hold
170
185
31/05/2010
Buy
156
199
Emkay Research
30 May 2011
Date
Reports
Reco
CMP
Target
30/05/2011
Accumulate
1,836
1,960
27/05/2011
Aban Offshore Q4FY11 Result Update
Accumulate
541
645
26/05/2011
Century Plyboards Q4FY11 Result Update
Buy
65
75
25/05/2011
Madras Cement Q4FY11 Result Update
Accumulate
93
100
32
Chemical business continues to do well

May 30, 2011
Reco
Previous Reco
Buy
Buy
CMP
Target Price
Rs 103
Rs 157
NA
NA
5,473
Nifty
18,232
Sensex
(%)
1M
3M
Absolute
(4)
(17)
(1)
(11)
(8)
6M 12M

Rs
20
136
10
122
108
-10
94
-20
80
Jun-10
Chemical segment witnessed attractive results with EBIT
margins of ~28% (+300 bps yoy). Fertiliser segment margins

remain at meager level of ~2%
Increase in Nitric Acid capacity (by ~70%) to support revenue
growth in FY12E while commissioning of Ethyl Acetic and TDI

plant to add revenues in FY13E
estimates at Rs 26.5. However we maintain our TP of Rs 157
(7x FY12 EPS) due to volatility in earnings, maintain BUY
Q4FY11 results below estimates
Source: Bloomberg
150
699 mn against loss of Rs 383 mn previous year were below

estimates mainly due to lower than expected margins
Maintain FY12E estimates at Rs 22.4 and introduce FY13E
Price Performance
Rel. to Nifty
Q4FY11 APAT (adjusted for insurance claim of Rs 1 bn) of Rs
GNFCs Q4FY11 results were below our estimates due to lower than expected margins .
Revenues of Rs 8.4bn, +66% yoy, were marginally ahead of our estimates of Rs 8.1bn
driven by higher than expected chemicals revenues. However, EBITDA of Rs 1.25bn
(previous year EBITDA was Rs -561mn) were lower than our estimates of Rs 1.5bn.
Reported other income of Rs 1.1bn, +119% yoy, included accounting entry of Rs 1bn
related to insurance claim received. APAT (tax adjusted amount of Rs 670m n on
account of insurance claim) of Rs 699mn was lower than our estimates of Rs 902mn.
-30
Aug-10
Oct-10
Dec-10
GNFC (LHS)
Jan-11
Apr-11
Fertiliser segment margins continues to struggle at ~2%
Rel to Nifty (RHS)
Source: Bloomberg
Stock Details
Sector
Agri-input & Chemicals
Bloomberg
GNFC@IN
1554
Face Value(Rs)
Fertiliser segment reported revenues of Rs 4.5bn, +112% yoy, which was marginally
lower than our estimates of Rs 5bn. However, reported EBIT of Rs 834mn (compared to
loss of Rs 485mn) was ahead of our estimates of Rs 300mn. Reported EBIT included
Rs 750 mn related to insurance claims received during the quarter. Adjusting for the
insurance claim received, adjusted EBIT stood at Rs 84 mn (below our estimates of Rs
300 mn) indicating margins of mere 2%.
10
155
52 Week H/L
146/88
16/355
84202
0.2
Chemicals segment margins remain impressive at 28%

Chemicals segment revenues increased by 34% yoy to Rs 3.7bn (ahead of our
estimates of Rs 3.1bn) on account of rising chemicals prices. Chemical segment EBIT
of Rs 1 bn is adjusted for Rs 250 mn received on account of insurance claims and
resulting EBIT margins at 28% increased by 300 bps yoy. Chemicals prices continued to
remain strong during the quarter which benefited the company. We expect chemicals
prices to remain strong in FY12E and have modeled for 30% margins during the year.

Promoters
FII/NRI
Institutions
Private Corp
Public
41.2
41.2
41.2
6.0
6.1
5.1
25.1
25.4
25.7
2.2
2.3
2.4
25.5
25.1
25.7
Source: Capitaline
Maintain price target and recommend BUY

We expect chemicals segment performance to remain strong and maintain our FY12
estimates (EPS of Rs 22.4) and introduce FY13E estimates of Rs 26.5. We believe
commissioning of Nitric Acid plant (DNA and WNA) by July2011 is likely to drive
revenues growth in FY12E while commissioning of Ethyl Acetic and TDI plant to add
revenues in FY13E. Due to volatile chemical prices, we maintain our price target based
on 7x FY12 estimates of Rs 157 and maintain our BUY recommendation on the stock.
Financial Snapshot
Net
YE-Mar
Sales
FY10
26,145
FY11
28,459
FY12E
FY13E
Rs Mn
EBITDA
(Core)
EPS
EPS
RoE
(%)
(%)
PAT
(Rs)
% chg
3,100
11.9
1,239
10.3
(29.7)
3,774
13.3
1,664
10.7
4.1
33,396
6,973
20.9
3,489
22.4
36,260
8,434
23.3
4,122
26.5
EV/
P/E
EBITDA
P/BV
7.8
10.0
5.7
0.8
7.8
9.6
6.9
0.7
109.6
15.0
4.6
3.9
0.6
18.1
15.6
3.9
3.2
0.6
33
Result Update
GNFC
GNFC
Result Update
Key Financials Quarterly

Rs mn
Rs mn
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11
FY10
YoY (%)
Revenue
5,066
3,678
8,019
8,339
8,423
66.3
1.0
28,459
26,145
8.9
Expenditure
5,627
3,850
6,866
6,800
7,170
27.4
5.4
24,685
23,045
7.1
as % of sales
111.1
104.7
85.6
81.5
85.1
86.7
88.1
Consumption of RM
2,897
1,712
4,520
4,408
4,647
60.4
5.4
15,287
14,075
as % of sales
57.2
46.5
56.4
52.9
55.2
53.7
53.8
Power & Fuel
659
777
928
998
1,018
54.5
2.0
3,721
3,362
as % of sales
13.0
21.1
11.6
12.0
12.1
13.1
12.9
Employee Cost
453
518
581
608
650
2,356
1,968
as % of sales
8.9
14.1
7.2
7.3
7.7
8.3
7.5
3,321
3,640
11.7
13.9
(18.6)
3,774
3,100
Other expenditure
1,619
844
837
786
855
as % of sales
32.0
22.9
10.4
9.4
10.2
EBITDA
-561
(171)
1,153
1,539
1,253
Depreciation
EBIT
Other Income
Interest
PBT
Total Tax
Adjusted PAT
43.6
(47.2)
(323.3)
7.0
8.8
8.6
10.7
19.7
(8.8)
21.7
279
296
305
305
305
9.2
(0.0)
1,211
1,170
3.5
-841
(467)
848
1,234
948
(212.8)
(23.2)
2,563
1,930
32.8
524
98
99
94
145
(72.4)
54.1
436
863
(49.5)
38
38
42
46
59
53.5
26.6
184
234
(21.3)
(355)
(407)
905
1,282
1,035
(391.3)
(19.3)
2,814
2,559
10.0
28
(181)
267
398
336
1,107.2
(15.7)
820
1,082
(24.3)
(383)
(227)
639
884
699
(282.5)
(20.9)
1,994
1,477
35.1
(282.5)
(20.9)
1,994
1,477
(238)
(383)
(227)
639
884
699
670
Reported PAT
(383)
(227)
639
884
1,369
(457.5)
54.9
2,664
1,238
115.2
Reported EPS
(2.5)
(1.5)
4.1
5.7
8.8
(453.7)
54.6
17.1
7.9
115.5
(bps)
(bps)
EBIDTA
(11.1)
(4.7)
14.4
18.5
14.9
2,596
(358)
13.3
11.9
140
EBIT
(16.6)
(12.7)
10.6
14.8
11.3
2,785
(354)
9.0
7.4
162
EBT
(17.3)
(13.7)
10.1
14.2
10.6
2,791
(368)
8.4
6.5
187
PAT
(7.6)
(6.2)
8.0
10.6
8.3
1,586
(230)
7.0
5.6
136
Effective Tax rate
(7.8)
44.4
29.5
31.1
32.4
4,027
137
29.1
42.3
(1,317)
APAT after MI
Margins (%)
35.1
(bps)
Source: Company, Emkay Research
Emkay Research
30 May 2011
34
GNFC
Result Update
Revision in estimates
We have revised our revenue estimates for FY12E by 12% to reflect the commissioning of
Nitric Acid plant (DNA and WNA) by July2011. However, our PAT estimates remain flat for
FY12E as we expect chemicals margins to remain under pressure owing to lower capacity
utilization initially in the new plant. We have also introduced FY13E estimates and expect
company to report EPS of Rs 26.5, +18% yoy.
FY12E
Rs mn
Net sales
EBITDA
EBITDA %
FY13E
Old
Estimates
New
Estimates
29,792
33,396
12.1
36,260
8.6
6,660
6,973
4.7
8,434
21.0
% Change
Introducing
Estimates
22.4
20.9
-147 bps
23.3
238 bps
PAT
3,479
3,489
0.3
4,122
18.1
EPS
22.4
22.4
0.2
26.5
18.1
Segmental results
Rs mn
% yoy
Rs mn
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY (%)
QoQ (%)
FY11
FY10
YoY (%)
Fertilisers
2154
733
4762
4885
4564
111.9%
-6.6%
14943
14489
3.1%
Chemicals
2783
2816
3130
3355
3729
34.0%
11.2%
13030
11303
15.3%
Fertilisers
-485
-762
-18
355
84
-117.3%
-76.4%
-340
-333
NA
Chemicals
693
371
911
924
1034
49.2%
11.9%
3241
3196
1.4%
Fertilisers
-22.5%
-103.9%
-0.4%
7.3%
1.8%
2434
-544
-2.3%
-2.3%
Chemicals
24.9%
13.2%
29.1%
27.6%
27.7%
283
18
24.9%
28.3%
-341
EBIT
EBIT Margins (%)
Source: Company, Emkay Research
Emkay Research
30 May 2011
35
GNFC
Result Update
Key Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11
FY12E
FY13E
Y/E, Mar (Rs. mn)
FY10
FY11E
FY12E
FY13E
Net Sales
Growth (%)
26,145
(10.5)
28,459
8.9
33,396
17.3
36,260
8.6

Reserves & surplus
1,554
19,234
1,554
20,289
1,554
23,142
1,554
26,627
Expenditure
23,045
24,685
26,423
27,825
Net worth
20,789
21,844
24,696
28,181
Materials Consumed
14,075
14,799
16,698
18,130
Minority Interest
Power & Fuel

Employee Expenses
3,362
1,968
3,415
2,134
3,340
2,672
3,626
2,901
Secured Loans
Unsecured Loans
5,506
0
11,506
0
13,506
0
13,506
0
Other Exp
3,640
4,337
3,714
3,169
Loan Funds
5,506
11,506
13,506
13,506
EBITDA
3,100
3,774
6,973
8,434
Net deferred liabilities
2,160
2,160
2,160
2,160
Growth (%)
(28.7)
21.7
84.8
21.0
Total Liabilities
28,454
35,509
40,362
43,847
EBITDA margin (%)

Depreciation
11.9
1,170
13.3
1,211
20.9
1,720
23.3
1,950
Gross Block
30,842
41,141
48,541
56,541
EBIT
1,930
2,563
5,253
6,484
Less: Depreciation
19,149
20,360
22,080
24,030
EBIT margin (%)
7.4
9.0
15.7
17.9
Net block
11,694
20,780
26,460
32,510
Other Income
863
436
200
200
10,298
7,400
8,000
5,000
234
2,559
184
2,814
980
4,473
1,400
5,284
Investments
Current Assets
895
9,742
895
12,275
895
13,503
895
14,550
Tax
961
1,150
984
1,163
Inventories
4,050
4,635
3,751
4,073
37.5
40.9
22.0
22.0
167
4,375
4,849
5,265
Adjusted PAT
1,599
1,664
3,489
4,122
Cash & bank balance
2,986
709
1,562
1,586
Growth (%)
Net Margin (%)
(29.7)
6.1
4.1
5.8
109.6
10.4
18.1
11.4
Loans & advances

2,539
-
2,556
-
3,340
-
3,626
-
Current lia & Prov
4,174
5,841
8,496
9,108
Current liabilities
2,815
4,482
7,137
7,749
Provisions
1,359
1,359
1,359
1,359
Net current assets

Misc. exp
5,568
-
6,434
-
5,007
-
5,442
-
28,455
35,510
40,362
43,847
FY10
FY11E
FY12E
FY13E
11.9
13.3
20.9
23.3
6.1
5.8
10.4
11.4
ROCE
10.3
9.4
14.4
15.9
ROE
RoIC
7.8
12.0
7.8
12.6
15.0
18.6
15.6
19.6
Interest expenses
PBT
Sundry debtors
Adjusted PAT After JVs/Ass/MI
1,599
1,664
3,489
4,122
E/O items
(360)
Reported PAT
PAT after MI
1,239
1,239
1,664
1,664
3,489
3,489
4,122
4,122
Growth (%)
(45.6)
34.4
109.6
18.1
Y/E, Mar (Rs. mn)
FY10
FY11E
FY12E
FY13E

Depreciation
1,696
1,170
2,379
1,211
4,273
1,720
5,084
1,950
Profitability (%)
EBITDA Margin
234
184
980
1,400
Net Margin
(377)
Chg in working cap

Tax paid
3,060
-961
(3,144)
-1,150
2,281
-984
(412)
-1,163
Cash Flow
Total Assets
Key Ratios
Interest Provided
Operating Cashflow
Y/E, Mar
4,822
-520
8,270
6,860
(6,664)
(7,400)
(8,000)
(5,000)
EPS
10.3
10.7
22.4
26.5
-1,842
-7,920
270
1,860
CEPS
17.8
18.5
33.5
39.1
Other income
Investments
863
-
436
-
200
-
200
-
BVPS
DPS
134
3.3
141
3.4
159
3.5
181
3.5
Investing Cashflow
863
436
200
200
Valuations (x)
PER
10.0
9.6
4.6
3.9
1,947
6,000
2,000
P/CEPS
5.8
5.6
3.1
2.6
Interest Paid
(234)
(591)
(184)
(609)
(980)
(637)
(1,400)
(637)
P/BV
EV / Sales
0.8
0.7
0.7
0.9
0.6
0.8
0.6
0.7
EV / EBITDA
5.7
6.9
3.9
3.2
Others
Dividend Yield (%)
3.2
3.2
3.4
3.4
Financing Cashflow
1,122
5,207
383
-2,037
Gearing Ratio (x)
Net chg in cash

143
2,843
-2,277
2,986
854
709
23
1,562
Net Debt/ Equity

Net Debt/EBIDTA
0.1
0.5
0.5
2.6
0.4
1.6
0.4
1.3
2,986
709
1,562
1,586
19.6
58.1
16.0
16.0
Capital expenditure
Free Cash Flow
Emkay Research
30 May 2011
Per Share Data (Rs)
36
GNFC
Result Update
Recommendation History: Gujarat Narmada Fertiliser and Chemicals GNFC IN

Date
Reports
Reco
CMP
Target
11/04/2011
GNFC Company Update
Buy
108
157
31/01/2011
GNFC Q3FY11 Result Update
Buy
112
157
21/10/2010
Buy
127
157
03/08/2010
Buy
115
157
CMP
Target
Emkay Research
30 May 2011
Date
Reports
Reco
30/05/2011
GSFC Q4FY11 Result Update
Buy
356
530
24/05/2011
Tata Chemicals Q4FY11 Result Update
Accumulate
352
400
12/05/2011
Deepak Fertilisers Q4FY11 Result Update
Buy
167
250
11/05/2011
Chambal Fertilisers Q4FY11 Result Update
Accumulate
81
86
37
Complexities increase, Retain BUY

May 30, 2011
Reco
Previous Reco
Buy
Buy
CMP
Target Price
Rs 665
Rs 810
EPS change FY12E (%)

VAT set off and higher production in MVML (100% subsidiary)

Ramp up in MVML visible with 4QFY11 EBIT account for 10%
of standalone EBIT. However, value is not getting captured
-2.4
due to limited information and complex structure
18,232
Sensex
affected due to higher staff cost (ESOP amortization), lower
-10
5,473
Nifty
Results below est. EBIDTA at Rs 8.6bn (est. of Rs9.8bn) was
Lower FY12 EPS by 10% to Rs 42. Lower EBIDTA margins est.
by 170 bps to 13% due to ESOP (40bps), VAT (70bps) and

higher production at Chakan (40 bps)
Price Performance
(%)
1M
3M
6M 12M
Absolute
(12)
12
(14)
22
Rel. to Nifty
(6)
(7)
14
Source: Bloomberg
Introduce FY13 est. with an EPS of Rs 50, Retain BUY with a
SOTP value of Rs 810 down 2.4%) based on FY13 estimates.

Stock to underperform till clarity emerges on margins

825
Rs
30
770
22
715
14
660
605
-2
Net Sales in line with est.

Net sales at Rs 67.8bn were in line with our est. Average selling price at Rs 416,308
improved by ~1% YoY and ~2% QoQ driven by improving product mix and price hikes of
~2% taken during the quarter.
Product Mix %
550
Jun-10
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
UV's
46.3
42.4
48.0
46.6
48.8
Three Wheelers
17.1
15.8
14.4
10.6
11.0
Tractors
34.3
37.5
32.2
37.3
35.1
2.3
4.4
5.4
5.5
5.1
128,428
127,299
131,285
148,631
160,511
-10
Aug-10
Oct-10
Dec-10
Mah & Mah (LHS)
Jan-11
Apr-11
Rel to Nifty (RHS)
Source: Bloomberg
Stock Details
Automobiles
Sector
MM@IN
Bloomberg
3070
Export
Units Sold
Source: Company , Emkay research
Face Value(Rs)
614
826/550
52 Week H/L
408/9,052
374401
5.7

Promoters
24.9
22.8
25.8
FII/NRI
32.7
35.0
32.2
Institutions
23.6
24.3
24.6
Private Corp
10.2
8.9
8.2
8.6
9.0
9.2
Public
EBIDTA Higher staff cost/lower VAT set off/Higher production at MVML

dents performance
EBIDTA at Rs 8.6bn was below our est. of Rs 9.8bn due to higher staff cost. Staff cost at
Rs 4.3bn (6.3% of sales) was up 60% YoY and 23% QoQ. This was due to impact of
amortization of employee stock option (Rs 260mn or 0.4% of sales) and higher provision
of employee PF (~90mn or 0.15% of sales). 4QFY11 was affected by change in rule with
respect to set off of state VAT (~12.5%) w.e.f 15th March 2011. The im pact of the same is
~ Rs 70mn for 15 days. Similarly, higher production at MVML (100% subsidiary) also
affected the standalone margins due to distribution of profits between the two companies.
Net profit marginally below est due to higher other inc./interest inc.
APAT at Rs 6.1bn was only 4% below est due to higher interest income for the quarter,
indicating strong cash flow generating from the business.
Source: Capitaline
Financial Snapshot
YE-
Net
EBITDA
EPS
EPS
RoE
EV/
Mar
Sales
(Core)
(%)
APAT
(Rs) % chg
(%)
P/E
EBITDA
P/BV
FY10
185,296
28,828
15.6
19,459
31.5
145.3
29.8
21.1
13.3
5.6
FY11P
234,220
34,131
14.6
25,038
40.5
28.7
27.6
16.4
10.6
4.2
FY12E
270,030
35,047
13.0
25,895
41.9
3.4
23.1
15.9
9.9
3.6
FY13E
315,915
41,791
13.2
31,200
50.4
20.5
23.7
13.2
7.7
3.1
38
Result Update
Mahindra & Mahindra Ltd.
Mahindra & Mahindra
Result Update
Quarterly Summary
Rs mn
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
YoY(%)
QoQ(%)
FY11
FY10
YoY(%)
Revenue
53,046
51,601
53,635
61,211
67,782
27.8
10.7
234,228
185,296
26.4
Expenditure
44,591
43,845
45,135
51,973
59,163
32.7
13.8
200,116
156,215
28.1
85.4
84.3
33.6
13.0
162,639
123,329
69.4
66.6
60.1
22.6
14,196
11,985
6.1
6.5
23,280
20,901
9.9
11.3
as % of sales
Consumption of RM
as % of sales
84.1
85.0
84.2
84.9
87.3
35,845
35,905
36,494
42,358
47,883
31.9
67.6
69.6
68.0
69.2
70.6
2,661
3,137
3,323
3,475
4,261
5.0
6.1
6.2
5.7
6.3
6,084
4,803
5,318
6,140
7,020
11.5
9.3
9.9
10.0
10.4
8,456
7,756
8,500
9,238
8,619
1.9
(6.7)
34,112
29,081
17.3
947
976
970
1,022
1,171
23.6
14.6
4,139
3,708
11.6
7,508
6,780
7,530
8,216
7,448
(0.8)
(9.3)
29,974
25,373
18.1
181
205
1,998
419
474
161.6
13.2
3,095
1,994
55.3
(227)
(91)
(27)
(158)
(1,858.9)
484.1
(503)
278
(280.8)
PBT
7,681
7,211
9,618
8,662
8,080
5.2
(6.7)
33,572
27,089
23.9
Total Tax
1,978
1,588
2,483
2,490
2,015
1.9
(19.1)
8,575
7,221
18.8
Adjusted PAT
5,703
5,624
7,135
6,172
6,065
6.4
(1.7)
24,997
19,868
25.8
(1.7)
24,997
19,868
25.8
Employee Cost
as % of sales
Other expenditure
as % of sales
EBITDA
Depreciation
EBIT
Other Income
Interest

Adj.PAT after MI
15.4
5,703
5,624
7,135
6,172
6,065
6.4
14.3
18.5
11.4
467
1,175
467
1,642
1,010
62.5
Reported PAT
5,703
5,624
7,602
7,347
6,065
6.4
(17.4)
26,638
20,878
27.6
Reported EPS
9.8
8.6
11.6
11.2
9.3
(5.5)
(17.4)
45.7
35.9
27.4
(bps)
(bps)
Margins (%)
(bps)
EBIDTA
15.9
15.0
15.8
15.1
12.7
(322)
(238)
14.6
15.7
(113)
EBIT
14.2
13.1
14.0
13.4
11.0
(317)
(243)
12.8
13.7
(90)
EBT
14.5
14.0
17.9
14.2
11.9
(256)
(223)
14.3
14.6
(29)
PAT
10.8
10.9
13.3
10.1
8.9
(180)
(113)
10.7
10.7
(5)
Effective Tax rate
25.8
22.0
25.8
28.7
24.9
(82)
(381)
25.5
26.7
(111)
Segmental performance- MVML reports strong numbers, margins in Auto/FES

under pressure
MVML (100% subsidiary) reported strong performance for 4QFY11. MVML accounted for 10%
of standalone EBIT. We expect the share of MVML to increase going forward. As a result the
standalone margins will be under pressure. In 4QFY11, both FES and auto segment reported
QoQ drop in margins. However, both of them reported improvement in ROCE
Emkay Research
30 May 2011
39
Mahindra & Mahindra
Segmental details (Rs mn)
Result Update
Q4FY10
Q1FY11
Q2FY11
Q3FY11
Q4FY11
Tractor (Units)
46,963
50,150
45,508
58,608
59,388
Net Sales (Rs mn)
21,763
22,739
20,850
26,383
27,997
Avg realizations
463,416
453,412
458,159
450,157
471,418
Results (Rs mn)
4,358
3,894
3,561
4,872
4,756
20.0
17.1
17.1
18.5
17.0
11,147
8,756
13,436
11,324
10,316
39.1
44.5
26.5
43.0
46.1
81,465
77,149
85,777
90,023
101,123
Farm Equipment
Margins %
Capital Employed (Rs mn)
ROCE %
Automotive
UVs and 3-wheelers (units)
Net Sales (Rs mn)
31,139
28,798
33,239
34,716
39,598
Avg realizations
363,535
373,280
387,502
385,634
391,581
Results (Rs mn)
4,065
3,521
4,473
4,266
4,182
13.1
12.2
13.5
12.3
10.6
726
20,755
20,856
25,869
28,856
27,548
19.6
16.9
17.3
14.8
15.2
240
386
1247
Margins %
Extraordinary inc/(exp)
ROCE %
MVML
Net Sales (Rs mn)
EBITDA (Rs mn)
Margins (%)
Results (Rs mn)
Margins (%)
Net Profit (Rs mn)
ROCE(%)
96
319
765
40.1
82.7
61.3
60
283
729
25.0
73.3
58.4
14
236
682
16401
17473
18609
0.4
1.6
3.9
Introducing FY13 est.

We expect overall volume growth of ~15% in FY13. We have not factored in the sales of new
SUV and we are conservative on our exports estimates with a growth of 16%, accounting for
5.5% of total sales . On earnings, we expect 20% growth in net profit to Rs 31.2bn driven by
17% increase in top line to Rs 316bn and 20 bps improvement in EBITDA margin to 13.2%
Uv's
Three Wheelers (Inc Gio)
Tractors
Exports
FY13e
%YoY
361,863
16.3
71,175
8.9
253,037
14.0
36,412
16.3
Total
722,488
14.7
Sales
315,915
17.0
41,791
19.2
EBIDTA
EBIDTA margins (%)
Net Profits
EPS
13.2
31,200
20.5
50.4
20.5
Valuations and View

We have valued the company on SOTP basis. We have lowered our TP by ~2% to Rs 810.
We have valued the standalone business at Rs 658 (lowered by 5%) which implies 7.5x
FY13E EV/EBIDTA. We have valued the listed subsidiaries and Tech Mahindra at Rs 138 per
share. We introduce value for MVML subsidiary at Rs 15 (7.5x FY12E EV/EBITDA, EBITDA of
Rs 2.3bn and net debt of Rs 8bn in FY12E)
Emkay Research
30 May 2011
40
Mahindra & Mahindra
Result Update
Revision in Estimates
FY12E
Volumes
Earlier
Revised
% Change
Uv's
314,064
311,133
(0.9)
69,596
65,339
(6.1)
218,170
221,962
1.7
Three Wheelers (Inc Gio)

Tractors
Exports
25,105
31,317
24.7
Total
626,935
629,750
0.4
Sales ( Rs. Mn)
268,091
270,030
0.7
39,278
35,047
(10.8)
14.7
13.0
28,734
25,895
EBIDTA ( Rs. Mn)

EBIDTA margins (%)
Net Profits( Rs. Mn)
(9.9)
Valuation Summary
Particulars
Basis
Discount
Value per share (Rs)

FY12E
M&M
EV/EBIDTA (7.5x)
658
MVML *
EV/EBITDA (7.5x)
15
Listed Subsidiaries
Mahindra Finance
CMP
20
48
Mahindra Forgings
CMP
20
Mahindra Life
CMP
20
Mahindra Holidays
CMP
20
30
Mahindra Ugine
CMP
20
Tech Mahindra
CMP
20
Total
45
810
* Source: MVML Annual Report FY10
Key extracts from the con call
Emkay Research
30 May 2011
Management maintains its industry growth target of 16%-18% and 11-13% for automotive
and FES segment respectively for FY12.
Expect tractor demand to remain strong driven by labour shortage, higher farm income
due to higher MSP and good monsoons
Price hikes of ~2% in automotive segment and ~3% in tractor segment have been taken
during April to offset rising input costs.
Management expects raw material cost pressures of ~6% - 9% in FY12. Moreover, tractor
segment is likely to witness higher pressure as compared to automotive segment.
Automotive segment to witness a strong line up of another 6 -7 launches over the

remaining part of FY12 which includes a new SUV in H2FY12.
Chakan plant (MVML) produced 40,000 units in FY11. Management expects this to ramp
up in FY12 and contribute ~25% of over volumes primarily driven by Maxximo, New SUV,
Navistar trucks and Ssangyong models to be introduced in India.
Maharashtra VAT rule has likely impacted MVML EBITDA by ~Rs 70mn for a 15 day
period. Also, the impact is likely to be front ended resulting in lower margins during first
few years of operation and improvement later.
Target ~50% growth in top line for Ssangyong in FY12. However, do not expect
Ssangyong to break even in FY12.
41
Mahindra & Mahindra
Result Update
Financials
Income Statement
Balance Sheet
Y/E, Mar (Rs. mn)
FY10
FY11P
FY12E
FY13E
185,296
234,220
270,030
315,915
2,910
3,276
3,093
3,093
42.0
26.4
15.3
17.0
Reserves & surplus
75,393
99,771
117,865
139,665
156,469
123,462
200,089
162,631
234,983
192,553
274,124
226,239
Minority Interest
Net worth
78,302
-
103,047
-
120,958
-
142,758
-
Employee Cost
11,985
14,195
16,238
17,915
Secured Loans
6,025
5,285
5,285
5,285
Other Exp
21,022
23,262
26,192
29,970
Unsecured Loans
22,777
18,769
18,769
16,769
EBITDA
Loan Funds
28,802
24,053
24,053
22,053
2,403
109,507
3,544
130,644
3,544
148,554
3,544
168,355
Gross Block
52,763
61,763
72,763
79,763
Less: Depreciation
25,378
29,516
34,464
39,888
Net block
27,385
9,642
32,247
11,471
38,299
9,000
39,875
9,000
Investment
63,980
93,253
109,253
127,253
Current Assets
60,424
61,435
72,390
86,059
Inventories
11,888
16,942
21,548
25,209
Sundry debtors
Cash & bank balance
12,581
17,432
13,547
6,146
18,462
4,878
21,599
7,256
Loans & advances
18,014
23,732
26,435
30,927
Net Sales
Growth (%)
Expenditure
Materials Consumed
Y/E, Mar (Rs. Mn)
FY10
FY11P
FY12E
FY13E
28,828
34,131
35,047
41,791
Growth (%)
175.1
18.4
2.7
19.2
EBITDA margin (%)

Depreciation
15.6
3,708
14.6
4,138
13.0
4,948
13.2
5,424
25,120
29,993
30,099
36,367
13.6
1,994
278
12.8
3,093
(535)
11.1
3,539
(435)
11.5
4,166
(519)
PBT
26,835
33,621
34,073
41,053
Tax
7,376
8,583
8,177
9,853
27.5
25.5
24.0
24.0
19,459
145.3
25,038
28.7
25,895
3.4
31,200
20.5
Net Margin (%)

10.5
-
10.7
-
9.6
-
9.9
-
509
1,067
1,067
1,067
19,459
25,038
25,895
31,200
Current lia & Prov
51,965
67,676
80,225
93,670
E/O items
Reported PAT
1,418
20,878
1,642
26,679
25,895
31,200
Current liabilities
Provisions
34,000
17,965
47,617
20,059
55,921
24,304
65,236
28,434
145.3
28.7
3.4
20.5
8,458
(6,241)
(7,835)
(7,611)
41
109,507
130,730
148,717
168,517
FY10
FY11P
FY12E
FY13E
13.2
EBIT
EBIT margin (%)
Other Income
Interest expenses

Adjusted PAT
Growth (%)
Growth (%)

Total Liabilities
Net current assets

Misc. exp
Total Assets
Cash Flow
Key Ratios
Y/E, Mar (Rs. mn)

Depreciation
Interest Provided
FY10
FY11P
FY12E
FY13E
Y/E, Mar
24,842
3,708
30,528
4,138
30,534
4,948
36,887
5,424
Profitability (%)
EBITDA Margin
15.6
14.6
13.0
278
(535)
(435)
(519)
Net Margin
10.5
10.7
9.6
9.9
6,032
7,371
76
ROCE
26.8
27.6
24.1
25.6
Chg in working cap
(4,119)
3,414
326
2,154
Tax paid
Operating Cashflow
(7,376)
23,365
(8,583)
36,333
(8,177)
27,271
(9,853)
34,092
RoIC
Per Share Data (Rs)
Capital expenditure
(6,999)
(10,829)
(8,529)
(7,000)
Free Cash Flow
16,366
25,504
18,742
27,092
1,994
4,734
3,539
4,166
(8,449)
(6,456)
(29,273)
(24,539)
(16,000)
(12,461)
(18,000)
(13,834)
(183)
Other income
Investments
Investing Cashflow
118

Interest Paid
(11,726)
(4,749)
(2,000)
(278)
535
435
519
(6,238)
-
(8,038)
-
(7,802)
-
(9,400)
-
ROE
29.8
27.6
23.1
23.7
162.1
157.1
133.2
144.7
EPS
31.5
40.5
41.9
50.4
CEPS
37.5
47.2
49.4
58.7
BVPS
119.5
157.3
184.6
217.9
9.4
10.9
11.2
13.4
PER
21.1
16.4
15.9
13.2
P/CEPS
17.8
14.1
13.5
11.3
5.6
4.2
3.6
3.1
2.1
13.3
1.5
10.6
1.3
9.9
1.0
7.7
1.4
1.6
1.7
2.0
0.00
(0.02)
(0.08)
(0.15)
0.00
(18.78)
(0.05)
(26.69)
(0.27)
(21.51)
(0.52)
(21.29)
DPS
Valuations (x)
P/BV
EV / Sales
EV / EBITDA
Others
10,103
Dividend Yield (%)
Financing Cashflow
(8,021)
(12,252)
(7,550)
(10,881)
Gearing Ratio (x)
1,890
(11,286)
(1,269)
2,378
Net Debt/ Equity
15,618
17,432
17,432
6,146
6,146
4,877
4,878
7,256
Net Debt/EBIDTA
Net chg in cash

Emkay Research
30 May 2011
42
Mahindra and Mahindra
Result Update
Recommendation History: Mahindra and Mahindra MM IN

Date
Reports
Reco
CMP
Target
09/02/2011
M&M Q3FY11 Result Update
Buy
654
830
12/01/2011
M&M Management Meet Update
Buy
736
880
29/10/2010
Buy
732
880
29/07/2010
Buy
644
775

Date
Reports
Reco
CMP
Target
26/05/2011
Tata Motors Q4FY11 Conso Result Update
Buy
1,161
1,450
26/05/2011
Motherson Sumi Q4FY11 Result Update
Accumulate
226
260
25/05/2011
JK Tyre & Industries Q4FY11 Result Update
Accumulate
92
118
20/05/2011
Ashok Leyland Q4FY11 Result Update
Accumulate
51
63
Emkay Global Financial Services Ltd.

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with it, accepts any liability arising from the use of this document. The recipient of this material should rely on their own investigations and take their own professional advice. Opinions expressed are
our current opinions as of the date appearing on this material only. While we endeavor to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance,
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completeness cannot be guaranteed.
Emkay Research
30 May 2011
www.emkayglobal.com

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Stock Update

Retail Advisory Team

Your success is our success

May 30, 2011

January 06, 2010 | 1

Strong ad revenue growth of 19.7% yoy to Rs Rs1.9bn, on the

EPS change FY12E/13E (%)

Target Price change (%)

Jagran Prakashan (LHS)

PAT were lower at Rs145mn and Rs20mn, resp. Decline is

Given the escalation in costs, we cut EPS est. by 3.6/1.5% for

FY12E/13E. Valuations at 15.3x/12.1 for FY12E 13E. Retain

Strong advertisement revenue growth

Equity Capital (Rs mn)

No of shares o/s (mn)

Daily Avg Volume (No of sh)

Daily Avg Turnover (US$mn)

Shareholding Pattern (%)

declined by 150bps. Led by higher raw material cost & other

Rel to Nifty (RHS)

EBITDA improved by 12.9% yoy, however, EBITDA margin

Revenue better than estimates but with dented margin

Relative Price Chart

back of improving yields. Circulation rev. up 6.3% to

Mid-Day financials re-aligned as per JPLs accounting policies

Other businesses on track

Emkay Global Financial Services Ltd

Effective tax rate%

Cut in EPS estimates by 3.6/ 1.5% for FY12E/13E

Y/E, Mar (Rs. mn)

Y/E, Mar (Rs. mn)

Equity share capital

Reserves & surplus

Net deferred tax liability

Total operating expenditure

EBIT margin (%)

Cash & bank balance

Loans & advances

Other current assets

Effective tax rate (%)

Net current assets

Core EBITDA Margin

Net Current liabilities

Y/E, Mar (Rs. mn)

Chg in working cap

Per Share Data (Rs)

Dividend paid (incl tax)

Dividend Yield (%)

Opening cash position

Gearing Ratio (x)

Closing cash position

Net chg in cash

Net Debt/ Equity

Recommendation History: Jagran Prakashan JAGP IN

Jagran Prakashan Management Meet Update

Jagran Prakashan Q3FY11 Result Update

Jagran Prakashan Q2FY11 Result Update

Jagran Prakashan Q1FY11 Result Update

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