EXIDE INDUSTRIES LTD - SEPTEMBER QUARTER FY17

Exide Industries Ltd reported double digit growth in September quarter FY17. Revenue or Income From Operations, PAT and EBDITA all rose in double digits at 11%, 17% and 18% respectively.  Revenue rose 11% YOY from Rs. 19654 Mn to Rs. 21746 Mn in the current September quarter.  Sequentially growth rate was negative at 4% for Revenue compared to 28% quarterly growth in Q1 FY17. Net Profit grew at a higher rate of 17% yearly at Rs. 1813 Mn against Rs. 1551 Mn in the same period previous year. EBDITA stood at Rs. 3118 Mn compared to Rs. 2637 Mn in the same period previous year growing by 18% YOY whereas QOQ negative growth was 5% in the current September quarter. Expenditure jumped 11% YOY from Rs. 17478 Mn to Rs. 19324 Mn in the current September quarter. On quarterly basis there was decline of 3%. EBDITA margin improved 92 basis points YOY as Revenue growth outpaced rise in operating expenditure. Interest or Finance costs declined 66% QOQ at Rs. 5.80 Mn in the current September quarter vis-à-vis Rs. 17.10 Mn in previous June quarter. Tax expenditure constituting 4% of total revenue jumped 12% YOY in Q2 FY17. Taxation expense was reported at Rs. 792 Mn compared to Rs. 708 Mn in the same period previous year. Net Profit Margin was 8.34% against 7.89% same period previous year, improving by 45 basis points YOY. Other Income on the other hand was on a rising spree with a YOY jump of 125% and was reported at Rs. 190 Mn compared to Rs. 84 Mn in current Q2 FY16. 

We recommend BUY for the stock for medium & long term investment with PE multiple of 21.01x FY17E & 19.20 x FY18E. P/BV is seen at 2.87 x FY17E & 2.50 x FY18E with a target price of Rs. 230. Disclaimer                                                                                                     The information and opinions contained in the research reports have been compiled or arrived at from sources believed reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness. The research report does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Clients should consider whether any advice or recommendation in this research is suitable for their particular circumstances and, if appropriate, seek professional advice, including but not limited to tax advice. The reports do not take into account the particular investment objectives, financial situations, risk profile or needs of individual clients. The user assumes the entire risk of any use made of this information. This report is not to be relied upon in substitution for the exercise of independent judgment. The price and value of investments referred to in this research and the income from them may fluctuate. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Research data and reports published/ emailed/ text messaged via Short Messaging Services, Online Messengers, WhatsApp etc/transmitted through mobile application/s, including but not limited to FLIP™, Video Widget, telephony networks, print or electronic media and or those made available/uploaded on social networking sites (e.g. Facebook, Twitter, LinkedIn etc) is for informational purposes only. The reports are provided for assistance and are not intended to be and must not alone be taken as the basis for an investment decision. The user assumes the entire risk of any use made of this information. Though disseminated to clients simultaneously, not all clients may receive the reports at the same time. We will not treat recipients as clients by virtue of their receiving this report. The reports include projections, forecasts and other predictive statements which represent our assumptions and expectations in the light of currently available information. These projections and forecasts are based on industry trends, circumstances and factors which involve risks, variables and uncertainties. The actual performance of the companies represented in the report may vary from those projected. The opinions expressed in the reports are subject to change but we have no obligation to tell our clients when our opinions or recommendations change. The reports are non-inclusive and do not consider all the information that the recipients may consider material to investments. We shall not be in any way responsible for any indirect, special or consequential damages that may arise to any person from any inadvertent error in the information contained in the reports nor do they take guarantee or assume liability for any omissions of the information contained therein. Information contained therein cannot be the basis for any claim, demand or cause of action. These data, reports and information do not constitute scientific publication and do not carry any evidentiary value whatsoever. The user should consult their own advisors to determine the merits and risks of investment and also read the Risk Disclosure Documents for Capital Markets and Derivative Segments as prescribed by Securities and Exchange Board of India before investing in the Indian Markets. The securities discussed in this report may not be suitable for all investors. Investors must make their own investment decision based on their own investment objectives, goals and financial position and based on their own analysis. Prospective investors and others are cautioned that any forward-looking statements, if any, are not predictions and may be subject to change without notice.