Balkrishna Industries Q4FY17: Fundamental Analysis - Firstcall India Equity

Firstcall India Equity | May 27, 2016, midnight


SYNOPSIS

  • Balkrishna Industries Ltd is a leading manufacturer in the Off-Highway tire market.
  • Revenue for the quarter increased by 15.23% at Rs. 10029.40 mn from Rs. 8703.90 mn, when compared with the prior year period.
  • During the quarter, EBIDTA is Rs. 3170.90 mn as against Rs. 2888.70 mn in the corresponding period of the previous year, up by 9.77%.
  • During Q4 FY17, net profit increased by 1.79% to Rs. 1374.70 mn from Rs. 1350.50 mn in the corresponding quarter of previous year.
  • During Q3 FY17, Profit before tax stood at Rs. 2367.40 mn as compared to Rs. 2105.90 mn in Q4 FY16, up by 12.42%.
  • EPS of the company stood at Rs. 14.22 during the quarter, as against Rs. 13.97 per share over previous year period.
  • Balkrishna Industries Ltd has recommend payment of Final Dividend of Rs. 2.50 per Equity Share (125%) on the Equity Shares of Rs. 2/- each (face value) for the year ended March 31, 2017.
  • During FY2016-17, Revenue rose by 16% to Rs. 37883.00 mn from Rs. 32725.20 mn in FY2015-16.
  • During FY2016-l7, PAT rose by 63% at Rs. 7151.40 mn from Rs. 4385.70 mn in FY2015-16.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 14% and 29% over 2016 to 2019E, respectively.


OUTLOOK AND CONCLUSION

  • At the current market price of Rs. 1560.85, the stock P/E ratio is at 18.13 x FY18E and 15.98 x FY19E respectively.
  • Earning per share (EPS) of the company for the earnings for FY18E and FY19E is seen at Rs. 86.07 and Rs. 97.69 respectively.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 14% and 29% over 2016 to 2019E respectively.
  • On the basis of EV/EBITDA, the stock trades at 8.95 x for FY18E and 7.85 x for FY19E.
  • Price to Book Value of the stock is expected to be at 3.49 x and 3.01 x for FY18E and FY19E respectively.
  • Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.

 

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