Thyrocare June2016 ''excellent'' results: 1.Top line up by 7%/22% on qoq/yoy basis. 2.EBIT up by 17%/53% on qoq/yoy basis. 3. Nil finance cost! 4.PAT up by 18%/39% on qoq/yoy basis. 5.EPS up by 13%/31% on qoq/yoy basis. 6.TTM EPS is 10.8 which gives PE of 52x at CMP.
Sanghvi is a case of ''operating leverage''. It has shown good traction in last 2 -3 quarters. 60% revenue comes from Wind Sector where there is no immediate headwind but traction in Power & Refineries (15% each) remains to be seen. The company has bulked up on Cranes & is hopeful of increasing utilization. This large capacity addition (417 Cranes total) offers huge operating leverage. EBITDA margin is already 65%!
The company proposes tighter WC mgt to de-leverage (current D/E is 0.8x, I guess). The problem is that recently there was news that various state govt have not paid the wind project installers since 3-4 quarters! This may, in turn, percolate to Sanghvi & delay its plans of de-leveraging through reduction in NWC days and may also affect PnL through higher interest costs.
But, with patience, I am sure we will have good returns.....Fingers crossed.
AETL analysis: Parameter Last year 4 year Avg Return on Equity 28% 21% Return on Assets 17% 11% ROCE 23% 16% Free cash flow generated 71 64 NP generated 78 46 Sales CAGR 14% NP CAGR 24% EPS CAGR 24% DER 25% CR 1.2 CMP 896 PE 25 PB 7 PS 7 EPS 36 MCAP 1950 SALES 295 Inventory days 74 74 Receivable days 52 59 Creditors day 16 28
DCF at @-15% growth rate,terminal rate 2.5% & 10% discount Intrinsic Value 1100-1200
According to graham formula Intrinsic value around 1000-1130
after considering all the positives and negatives ...applying for 1 lot and then leaving it to your luck for the investment, can be a good strategy.....
I don''t see any reason for it to go any other way...It''s P/BV is high (c.6x) but still lower than SKS''s 7.8x. I think you will see some more uptick tomorrow.