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HDFC Securities Institutional Equities
Titan Company - Healthy topline print; profitability disappoints
While Titan Company Ltd. continued to clock healthy revenue growth of Rs 103.6 billion (up 33%; four-year compound annual growth rate: 21%; our estimate: Rs 98.8 billion), the margin fell short of expectations. Jewellery sales (excluding bullion; standalone) grew 23.5% (four-year CAGR: 18.4%) in Q4 FY23 as both the number of buyers and ticket sizes aided growth. Non-jewelry growth of 31% YoY (four -year CAGR: 13%) remained healthy too (inline). However, overall profitability disappointed.
Havells India - Switchgear, Lloyd outshine in a weak environment
Havells India Ltd.'s Q4 FY23 revenue grew by 10% YoY (our estimate: 9%), led by better-than expected performance of switchgears and Lloyd. Weakness in the business-to-consumer portfolio due to sluggish demand (70% of 4Q revenue) was more than offset by sustained business-to-business demand recovery. The electrical consumer durables segment disappointed as primary fan sales were impacted, given that the channel focused on liquidating stock pre-bought in Q3 (energy rating change).
Godrej Properties - Well-placed for growth
Godrej Properties Ltd. reported the highest-ever annual presales worth Rs 122 billion (up 56% YoY), with a booking area of 15.2 million square feet (up 40% YoY). This was on the back of robust launches of 15 msf. It expects to book Rs 140 billion in FY24, with 20 msf of launches planned (5/3.8 msf earmarked for Bengaluru/MMR). Godrej Properties added Rs 320 billion worth of gross development value in FY23, surpassing its guidance by more than two times. This higher GDV was supported by robust cash collection, which was the highest ever at Rs 90 billion (+40% YoY), and higher incremental debt, which increased to Rs 36.5 billion (Rs 25.8 billion in Dec-22).
Petronet LNG - Misses estimate
In Q4, Petronet LNG Ltd.'s reported Ebitda was at Rs 9 billion (-19% YoY, -44% QoQ) while profit after tax came in at Rs 6 billion (-18% YoY, -48% QoQ), below our estimates, impacted by lower-than expected volume of 185 trillions British thermal unit (-3% YoY, +11% QoQ) and higher other expenses. Higher-than-expected other income supported earnings
CDSL - Muted show continues
Central Depository Services Ltd. delivered lower-than-expected numbers, with revenue declining 11.6% QoQ, owing to a sharp drop in transaction charges (-23% QoQ) and IPO/corporate action revenue. The annuity revenue stream (~38% of revenue, 2.2% QoQ) is stable but growth will revert to the pre-Covid rate of ~17% CAGR, following a strong (~60% YoY) growth in FY23.
Orient Cement - Volume recovers QoQ; Capex plans revised
Orient Cement Ltd. reported 20/6% QoQ/YoY volume recovery in Q4 FY23 (flattish five-year CAGR) on healthy non-trade demand. Unit Ebitda recovered ~Rs 180 per million tonne QoQ on op-lev gains to Rs 812 per million tonne (it reported low employee and other expenses despite healthy volume growth QoQ).
Orient has changed its capex plan—it will add a 3 million metric tonne brownfield IU in Chittapur (expected by H1 FY26E). The 10 mega watt waste heat recovery system in Chittapur will get operational in Q1 FY24 and boost margin FY24 onwards.
Orient Cement faces increased regional competition from recent expansions by big players. The planned Chittapur expansion should stretch gearing, in our view.
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