Q2 Results Review
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Showing posts with label Results Strategy. Show all posts
Showing posts with label Results Strategy. Show all posts
Monday, November 09, 2009
Monday, February 09, 2009
Sunday, February 08, 2009
Thursday, February 05, 2009
Monday, November 10, 2008
Thursday, November 06, 2008
Thursday, August 07, 2008
Monday, August 06, 2007
FMCG cos log better profit margins
The 10-15% price hike undertaken by most consumer goods companies in the past two quarters has begun showing positively in their profit margins and toplines. FMCG majors such as Hindustan Unilever (HUL), GlaxoSmithKline Consumer Healthcare, Dabur India, Godrej Consumer Products and ITC have reported healthy margins and topline growth for the April-June quarter, aided to a large extent by price hikes.
Anand Shah, FMCG analyst at Angel Broking, said, “Price hikes undertaken by FMCG companies have begun reflecting in their performances. Margin expansions have been aided by buying efficiencies.” High-margin products are doing well and companies are able to protect margins.
HUL, which posted topline growth of 13% year-on-year to Rs 3,481 crore during the April-June quarter, saw its operating margin expand by 15%. Analysts attribute that to judicious price increases across categories. HUL had hiked prices of Knorr soups and certain SKUs of Surf Excel Blue, Rin Advance, Ponds, Lux and Sunsilk over the past few months. HUL’s foods business grew 25% while soaps and detergents grew 14.6% during the quarter.
“The full impact of price hikes done over the previous two quarters is showing now,” said Rajan Verma, CFO, Dabur India. Dabur posted a consolidated net profit increase of 31% in April-June quarter at Rs 62.08 crore compared to Rs 47.37 crore in the previous corresponding quarter. Its consumer care and foods divisions posted a healthy growth of 19% and 39% respectively. Dabur’s price hikes, too, were scattered ranging from honey (10%), to Anmol hair oil (5%), and baby care products (4%).
GSK, which effected a 4-5% upward revision of prices for Horlicks and Boost, posted year-on-year topline growth of 17% at Rs 316 crore, beating analyst expectations of 12% growth. Analysts say volume growth of 12% and value growth of 6% was aided by 4-5% price hikes the company undertook for Horlicks and Boost. Said Zubair Ahmed, MD, GSK, “
Growth has come partially because of the price rise which happened on account of rising milk prices, but more so because we leveraged marketing opportunities for our brands with 360 degree campaigns. Also, consumption of Horlicks and Boost is now spreading across the entire family instead of just children or the elderly.” Mr Shah said, “The Godrej’s soaps portfolio was not doing well last quarter, but this quarter, they have shown a 29% growth in soaps.
While 17-18% of this growth is accounted for by volumes, the remaining growth has happened because of higher prices.” ITC posted a topline growth of 17% in the quarter at Rs 3,325 crore, which, analysts say, is among the company’s strongest performances in the recent past. The recent price hikes helped the company to expand margins.
Monday, June 25, 2007
Quarterly Surprise ?
Buoyancy returned to Indian markets as equities rallied across all major sectors, other than software, on fresh buying by funds and traders. There were liquidity concerns because of public issues by DLF Ltd and ICICI Bank Ltd. But fresh buying by funds in the secondary market eased such concerns. Also, heavy oversubscription of the ICICI Bank share sale was another comforting factor. Inflation, which has been haunting the markets for quite some time, has now fallen to an acceptable, and rather unexpected, level. On the domestic front, there are no big concerns on the horizon.
But the situation is just the reverse on the global front. The resurfacing of concern over subprime contagion is a new challenge that global stock markets may face in days to come. Friday’s sharp fall on Wall Street was on fears that trouble at two Bear Stearns hedge funds may signal bigger problems for credit markets. Inflation and rising interest rates were already worrying markets across the globe and rising US bond yields had triggered a fall on global bourses. If the subprime problem spreads to more hedge funds, it could rattle all major global markets. The US markets are already under pressure as the yield on the benchmark 10-year treasury note has been approaching the 5.25% level. This may put pressure on the interest rates in the US.
This week, the US Federal Reserve meeting is scheduled on Wednesday and Thursday. The Fed has held the target for overnight interest rates steady at 5.25% since last June. Although only minor changes are expected in the meeting, the Fed may decide to hike interest rates, creating problems for global stock markets as it would put pressure on all major economies to review their own interest rates. But going by recent US economic data, chances of upward revision of interest rates are remote.
Other important data that will be released in the US this week includes home sales data on Monday and new home sales data on Tuesday. The new home sales are likely to be lower, compared with May. This may not impact markets substantially, but any positive surprises will boost the US markets. On Wednesday, the US commerce department reports on durable goods orders for May. This data is also likely to show a fall of 1% after a 0.8% rise in April—this has already been factored in by the markets. On Thursday, the revised figures of the first quarter GDP will be made available. This number is likely to be revised upwards to 0.8% from 0.6%.
Indian scenario
This week is going to be important for the domestic bourses as the derivatives contracts for June will expire on Thursday. Since the global markets are likely to be volatile and at present there are no major positive triggers on domestic bourses, the market will be quite volatile ahead of this expiry. The rollover thus far has been smooth and because of this, high open interest rates should not pose any problem. However, the creation of fresh short positions in the wake of uncertainty on global bourses could see some selling pressure building up. Also, the market may now start pondering over the earnings of the first quarter, as these will start arriving from the second week of July. The market’s expectations of first quarter earnings are not very encouraging. But given the strong growth in direct tax collections, the results may
spring some positive surprises.
Technical signs
This week is also going to be driven by a lot of uncertainties. It will start on a negative note and equities may register a fall initially. But no big-ticket selling is likely as the technical indicators are still bullish. Unless selling becomes a global phenomenon, uncertainty-led selling will be temporary.
Purely on a technical basis, the charts show that the market will be back on track from Wednesday. Stocks such as HDFC Bank Ltd, Suzlon Energy Ltd and Unitech Ltd look good on charts. However, readers should note that since some initial weakness is expected this week, it would be better to consider these stocks only after the market consolidates. HDFC Bank, at its current market price of Rs1,101, has the potential to move up to Rs1,064, with a stop-loss of Rs1,064. Suzlon Energy is currently northbound, but is likely to see a lot of volatility; however, with a medium-term perspective, the stock is a good buy. The stock, which is currently trading at Rs1,378, has a short-term target of Rs1,424 and a medium-term target of Rs1,467 with a stop-loss of Rs1,337. Unitech, at the current rate of Rs524.50, has a potential to move up to Rs547 in the short-term, with a stop-loss of Rs492.
From our last week’s recommendation, Century Textiles & Industries Ltd, recommended at Rs604, touched a high of Rs672, gaining 11.26% during the week, well above its target. IVRCL Infrastructures & Projects Ltd, recommended at Rs335, touched a high of Rs379, gaining 13.13%. And Punjab National Bank Ltd, recommended at Rs488, hit a high of Rs532.40, gaining 9.1% during the week.
Via Mint
Via Mint
Tuesday, April 10, 2007
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