Maintain ADD on Indian Oil Corporation - In-line performance - HDFC Securities
Posted On: 2021-02-03 09:57:56 (Time Zone: Arizona, USA)
Mr. Harshad Katkar, Institutional Research Analyst, HDFC Securities & Mr. Nilesh Ghuge, Institutional Research Analyst, HDFC Securities
We maintain ADD on IOC with a target price of INR 107, owing to an expected recovery in demand for petroleum products and, subsequently, refining margins in FY22/23. Reported EBITDA/APAT were 18/8% above our estimates, owing to higher GRM of USD 1.26/bbl (HSIE: USD 0.8/bbl), higher- than-expected throughputs, a higher-than-expected other income, offset by higher-than-expected tax outgo and finance cost. Refining and marketing business inventory gains were INR 9.2bn and INR 17.1bn. Adjusting for inventory gains and forex gain, core EBITDA comes to INR 66bn.
ADD on SRF - Returning to normalcy - HDFC Securities
Posted On: 2021-01-25 09:34:18 (Time Zone: Arizona, USA)
Mr. Nilesh Ghuge, Institutional Research Analyst, HDFC Securities & Mr. Harshad Katkar, Institutional Research Analyst, HDFC Securities
We retain our ADD rating on SRF with a target price of INR 6,080 on the back of (1) continued healthy performance from Speciality Chemicals business and Packging Films business, (2) recovery in the Technical Textile segment, (3) strong balance sheet, and (4) deployment of Capex towards high-growth Speciality Chemicals business over 3-4 years to tap the opportunities emerging from the agrochemical and pharmaceutical industry. EBITDA/APAT were 33/43% above estimates, owing to 6% higher revenue and lower-than- anticipated operating expenses and interest costs.