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Friday 2 November 2018

CORPORATE NEWS 02-NOV-2018


Bharat Forge climbs 5% on in line Q2FY19 results
Shares of Bharat Forge rose 5% in intraday trade on Friday after the company announced their quarterly results.
Standalone revenue was up 33% yoy (13% qoq) at Rs1,679cr vs the expectation of Rs1,494cr. EBITDA was up ~18% yoy (1% qoq) at Rs434cr, in-line with the expectations. EBITDA margin contracted 350bps yoy (310bps qoq) to 25.9%.
Lower other income and high-interest expense limited PAT growth to 12% yoy (down 3% qoq). At Rs227cr, PAT was below the expectations of Rs245cr.

OMC, aviation shares climb on stronger rupee, lower crude prices
Shares of oil marketing and aviation companies were trading higher in late noon trade on Friday amid lower crude oil prices and a strong local currency.
Accordingly, shares of Bharat Petroleum were trading 6% higher, while those of Indian Oil Corporation and Hindustan Petroleum Corporation were trading up 5% and 4%, respectively.
Further, shares of SpiceJet were also trading 5% up, while those of InterGlobe Aviation and Jet Airways climbed 3% and 4%, respectively.

Inox Leisure promoter to infuse Rs155cr via preferential issue of equity
The board of Inox Leisure has approved preferential issue of maximum 64 lakh equity shares to Gujarat Fluorochemicals Ltd, a promoter group entity. The floor price determined for this issue is Rs241.71/share. This will help company raising Rs155cr. Post this infusion the promoters holding will increase from 48.7% to 51.9%. Hence, this will result in dilution for the other shareholders in the same proportion.
The funds raised through the preferential issue will be used for the purpose of strengthening the balance sheet of the company by reducing debt, improving leverage and enhancing borrowing power for the future growth opportunities and increasing profitability. Post this infusion, its net-debt-to-equity will come down from 0.4 to 0.1. We expect Inox’s finance cost to come down from ~Rs29cr p.a. to Rs12-15cr. The full impact will be visible from FY20E.

Punjab National Bank slips 3% on quarterly loss of Rs4532cr
Shares of Punjab National Bank dipped 3% in afternoon trade on Friday after the bank posted a revenue decline of 1.2% yoy to Rs14,036cr in Q2FY19. Its NII for the quarter came in at Rs3,974cr as against Rs4,015cr yoy.
The bank has reported a net loss of Rs4,535cr in the quarter against the estimates of Rs1,211cr.
Its GNPA for Q2FY19 stood at 17.2% against 18.26% qoq, a decline of 110bps. NNPA for the quarter came in at 8.9% against 10.58% qoq, a decline of 168bps.

Hindalco up 3% on strong earnings result for Novelis in Q2FY19
Novelis Ltd, a subsidiary of Hindalco, reported strong growth in revenue and earnings on improved global demand and lower scrap costs. Revenue grew by 12.2% yoy to $3,136mn. EBITDA stood at $355mn, up 17.5% yoy. EBIDTA margin rose by 51bps yoy to 11.3%. Net Profit stood at $116mn, an increase of 56% yoy.
Shipments rose by 0.6% yoy to 807k tonnes. Shipments for the quarter were flat yoy as growth in the US segment (up 7.7% yoy) was offset by shrinkage in Europe (down 3.4% yoy), Asia (down 6.7% yoy) and South America (down 3.8% yoy).
Adjusted EBITDA for Q1FY19 rose by 18% yoy to $355mn due to higher volumes, increased shipment of premium products, as well as operational efficiencies and favourable metal costs.

The company announced that it has secured financing for the upcoming acquisition of Aleris by entering into commitment letters with bankers to provide a loan of up to $775mn with a five-year maturity, and up to a $1.5bn via a short-term bridge loan with one-year maturity.


Investment & trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance. CapitalStars Investment Adviser: SEBI Registration Number: INA000001647

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