Tata Sponge Q4FY18E Result Expectation@HighLight Investment
Our expectations for Q4FY18E:
Remarks:
The scrip opened at Rs1,132 and has touched a high and low of Rs1,145 and Rs1,126 respectively. The BSE group 'A' stock of face value Rs10 has touched a 52 week high of Rs1,248 on 12-Apr-2018 and a 52 week low of Rs770 on 11-Aug-2017. Last one week high and low of the scrip stood at Rs1,248 and Rs1,006.15 respectively.
The stock is currently trading above its 50 DMA.
- Revenue - Rs219cr, up by 18.4% yoy, due to ~10% yoy rise in sponge iron prices
- EBITDA - Rs58cr, up by 126% yoy
- EBITDA Margin - 26.6%, a rise of 412bps qoq supported by lower raw material prices
- PAT - Rs47cr, up by 123% yoy
- Revenue - Rs214cr, up by 36% yoy, due to ~16% yoy rise in realisations and 18% yoy increase in sponge iron sales volumes
- EBITDA – Rs48cr
- EBITDA Margin – 22.4%
- PAT – Rs36cr
Remarks:
- The stock would react positively over the medium term, though near term reaction may be subdued as the stock has already rallied about 11% over the past five sessions.
- We see sponge iron prices and volumes remaining firm over the medium term, as domestic steel production is expected to grow at over 5% over the next few years.
- However, as Tata Sponge is already operating at over 95% utilization, there is limited room for volume growth.
The scrip opened at Rs1,132 and has touched a high and low of Rs1,145 and Rs1,126 respectively. The BSE group 'A' stock of face value Rs10 has touched a 52 week high of Rs1,248 on 12-Apr-2018 and a 52 week low of Rs770 on 11-Aug-2017. Last one week high and low of the scrip stood at Rs1,248 and Rs1,006.15 respectively.
The stock is currently trading above its 50 DMA.
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