Scripscan:CEAT Ltd
cmp:75
Code:500878
Story:CEAT is one of the leading Tire companies in India providing car tires, bus tyres, SUV tyres, bike tyres, wheels, etc.Continuous ramp-up at the Halol plant improves operating performance: During 2QFY2012, the company’s net sales grew strongly by 32.7% yoy (3.7% qoq) to Rs 1,118cr on account of availability of additional capacity at the Halol plant and average price hike of ~10% in 1QFY2012. OEM and exports sales registered impressive growth of 57% and 90% yoy, respectively, while replacement sales grew by 14% yoy.Top-line growth also benefited from a 21.4% yoy increase in other operating income. Operating margin improved by 27bp yoy to 5.5%, largely due to ramp-up at the Halol facility and price increases carried out in 1QFY2012. While raw-material cost as a percentage of sales increased by 223bp yoy, the decline in staff cost and other expenditure as a percentage of sales (by 129bp and 132bp yoy, respectively) helped CEAT to maintain its margins. Net profit, however, fell sharply by 63.3% yoy to Rs 6cr due to significant rise in depreciation (114.4% yoy) and interest (170.4% yoy) expense.I expect CEAT to report continuous improvement in its operating performance, led by improving utilization at the Halol plant and a gradual decline in raw-material prices. Consequently,I estimate CEAT to post an EPS of Rs 20 in FY2013E.Buy it with a target price of 100rs to be achieved in the next 1 year.
Search This Blog(Over 800 companies covered in the blog).
Please note
Archives : Old artciles
Important Disclaimer&Privacy policy
This blog does not share personal information with third parties nor do we store any information about your visit to this blog other than to analyze and optimize your content and reading experience through the use of cookies.You can turn off the use of cookies at anytime by changing your specific browser settings.This privacy policy is subject to change without notice and was last updated on 20.3.2013. If you have any questions, feel free to contact me directly here: arunsharemarket@gmail.com
Investment in equity shares has its own risks.Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that I consider reliable. I,however,do not vouch for the accuracy or the completeness thereof.This material is for personal information and am not responsible for any loss incurred based upon it & take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations above.The stock price projections shown are not necessarily indicative of future price performance.The information herein, together with all estimates and forecasts, can change without notice.
