Reviews
We had recommended ITC in volume 34, issue no. 4, dated Jan 21–Feb 3, 2019, under the ‘Choice Scrip’ segment.
We had recommended ITC in volume 34, issue no. 4, dated Jan 21–Feb 3, 2019, under the ‘Choice Scrip’ segment. The stock was trading at Rs. 296 then and was recommended because of the company’s differentiated product development capacity, robust portfolio of brands and efficient marketing and distribution network.
ITC is one of India’s foremost private sector companies with a market capitalisation of US $ 45 billion and a turnover of US $ 7 billion. ITC has a diversified presence in FMCG, hotels, paperboards & specialty papers, packaging, agri-business, and information technology. The company is rapidly gaining market share even in its nascent businesses of packaged foods & confectionery, branded apparel, personal care and stationery.
On the financial front, the net sales for Q4FY19 has climbed 12.69 per cent to Rs. 12064.15 crore on a YoY basis from Rs. 10,705.75 crore. The PBIDT has also jumped 10.32 per cent YoY in Q4FY19 and came in at Rs. 4571.65 crore from Rs. 4144.01 crore posted in Q4FY18. The PAT for Q4FY19 stood at Rs. 3481.9 crore as against Rs. 2931.71 crore in Q4FY18.
On the annual front, the net sales were up by 2.88 per cent in FY19 to Rs. 45,221.41 crore from Rs. 43,956.90 core in FY18. The PBDT stood 11 per cent higher at Rs. 17,305.51 crore in FY19 from Rs. 15,540.98 crore posted in FY18. The PAT reached Rs. 12,464.32 crore, up by 11.06 per cent from Rs. 11,223.25 crore posted in FY18.
ITC is set to foray into new categories and sub-segments in FMCG vertical which will be supported by multidimensional investments and strategic opportunities for acquisitions. Since our recommendation the stock price has fallen around x per cent, however, we recommend a HOLD looking at strong financials.
We had recommended TV18 Broadcast Ltd. in volume 33, issue no. 24, dated Oct 29– Nov 11, 2018, under the Low Priced Scrip. The stock was trading at Rs. 36.55 then and was recommended owing to positive quarterly performance, attractive valuations and growth prospects.
TV18 Broadcast is a media company belonging to Network 18 Group engaged in television broadcasting networks. It is based in Mumbai. The company operates news channels, which also include various regional news channels, entertainment channels, channels for kids, regional entertainment channels and a reality entertainment channel.
On the financial front, the company posted net sales of Rs. 288.34 crore for Q4FY19, up by 26.43 per cent from Rs. 228.06 crore in Q4FY18. The PBDT was Rs. 28.46 crore, depicting a fall of 44.50 per cent in Q4FY19 from Rs. 51.28 crore posted in Q4FY18. The company posted a net profit of Rs. 17.98 crore in Q4FY19, a decrease of 35.83 per cent compared to the net profit of Rs. 28.02 crore in Q4FY18.
On the annual front, the net sales came in at Rs. 1079.21 in FY19, up by 46.74 per cent from Rs. 735.45 crore in FY18. The PBDT in FY19 fell by 67.55 per cent to Rs. 54.30 crore from Rs. 167.32 crore in FY18. The company’s net profit in FY19 was Rs. 85.05 crore, down by 11.75 per cent from Rs. 96.37 crore posted in FY18.
Post our recommendation, the stock has fallen by 35.56 per cent. For its news gathering operations, TV18 Broadcast recently signed a multi-year lease agreement for more than a hundred units of LiveU’s flagship LU600 HEVC solution. We recommend a HOLD.
(Closing price as of July 15, 2019)