Amara Raja Batteries | BSE Code: 500008 | CMP: 897 | FV: 1 | Market Cap (F.F): 7,352 Crore
Amara Raja Batteries is a manufacturer of lead-acid storage batteries for industrial and automotive applications in India. Its industrial and automotive batteries are exported to Singapore, Malaysia, Hong Kong, Thailand, Indonesia, Vietnam, Taiwan, Philippines, Tanzania and South Africa, among others.
On the nine-month financial front, Amara Raja Batteries’ revenue increased 13.22 per cent to Rs 3,334 crore in 9MFY17 as compared to the same period in the previous financial year. The company’s EBITDA too rose by 4.03 per cent to Rs 661 crore in 9MFY17 on a yearly basis. Its net profit decreased 0.4 per cent to Rs 379 crore in 9MFY17 as compared to the same period in the previous fiscal.
Amara Raja Batteries’ management is confident about company’s financials for upcoming quarters as the latest quarter was hit by demonetisation. Demonetisation of high value currency and sharp increase in raw material prices in Q3FY17 had moderate impact on its quarterly results.
Demonetisation and GST implementation will help Amara Raja Batteries gain market share as the demand will shift from the unorganised sector to the organised one. The company’s expansion of its four-wheeler battery capacity is proceeding as per plan and would be commissioned in Q4FY17.
Amara Raja Batteries’ total debt-to-equity ratio stood at 0.04x in FY16. The company has a very high interest coverage ratio of 1490x, indicating its capability of repaying debt. Its ROE and ROCE stood at 25.75 per cent and 36.58 per cent, respectively, in FY16. It has given dividend yield of 0.47 per cent to its shareholders.
On the valuation front, the share price of Amara Raja Batteries is trading at PE of 31.64x as against industry peers Eveready industries (20.19x), Exide Industries (23.75x), HBL Power System (46.81x). The industry PE is 26.69x.
Eicher Motors | BSE Code: 505200 | CMP: 23037 | FV: 10 | Market Cap (F.F): 28,202 Crore
Eicher Motors is engaged in the manufacture of automobile products and related components. The company operates in business verticals, including motorcycles, commercial vehicles and personal utility vehicles. Its premium brand, Royal Enfield, operates through approximately 20 company-operated stores and 500 dealers in various cities and towns in India, and exports to over 50 countries across the world. Eicher Motors also designs, develops, manufactures and sells a range of personal vehicles.
On the financial front, Eicher Motors’ revenue increased 43.46 per cent to Rs 10,248 crore in H1FY17 as compared to the same period in the previous financial year. The company’s EBITDA too rose by 66.17 per cent to Rs 2,169 crore in H1FY17 on a yearly basis. Its net profit also soared 60.16 per cent to Rs 1,395 crore in H1FY17, as compared to the same period in the previous financial year.
Eicher Motors’ motorcycles sales increased 36 per cent to 4,88,262 units in 9MFY17 on a yearly basis. Out of that, the company has exported 10,574 motorcycles, recording a growth of 78 per cent in 9MFY17 on year-on-year basis. Eicher Motors’s commercial vehicles segment sales has also witnessed a growth of 13.14 per cent to 41,263 vehicles in 9MFY17 on a yearly basis.
Eicher Motors ROE and ROCE stood at 48.56 per cent and 68.82 per cent, respectively, in FY16. The company has debt-to-equity ratio of 0.02x, which is very negligible. Its interest coverage ratio of 233x indicates a high capability of debt repayment.
On the valuation front, the share price of Eicher Motors is trading at a PE multiple of 44.87, as against its peers TVS Motor Company (51.61x), Hero Motor Company (20.22x), Bajaj Auto (21.38x). The industry is trading at a PE multiple of 26.84. It has given dividend yield of 0.43 per cent to its shareholders.
Aurobindo Pharma | BSE Code: 524804 | CMP: 682 | FV: 1 | Market Cap (F.F): 18,366 Crore
Aurobindo Pharma has acquired Generis Farmaceutica, which operates in Portugal, from Magnum Capital Partners for an all-cash deal of Rs 969.3 crore. The transaction includes production facility at Amadora, Portugal with a capacity of 120 crore tablets. The company is expecting to close the transaction by February 2017, subject to certain anti‐trust approvals. Post-acquisition, the Aurobindo group will be the leader in the generic pharmaceutical market in Portugal. It will have the largest generic portfolio of 271 products.
On the financial front, Aurobindo Pharma’s revenue increased 12.51 per cent to Rs 7,542 crore in H1FY17 on a yearly basis. The company’s EBITDA too rose 25.43 per cent to Rs 1,818 crore in H1FY17, as compared to the same period in the previous financial year. Its net profit went up 28.57 per cent to Rs 1191 crore in H1FY17 on a yearly basis. The company’s net debt-to-equity ratio stood at 0.4x in H1FY17.
On the geographical segmental revenue front, Aurobindo Pharma has earned 38.34 per cent from India, 36.92 per cent from the US, 20.98 per cent from Europe and remaining 3.76 per cent from rest of the world in FY16.
Aurobindo Pharma has extensive product pipeline with approximately 159 ANDAs pending for final approval. The company has lined up more than 20 products in the segment of oncology and hormones. These product launches and their commercialisation is to start from April 2019. The company will launch commercially 'Bx' of pneumococcal conjugate vaccine with an addressable market size of USD 6 billion in 2019.
Aurobindo Pharma’s four products from Microspehers which are under development will be filed soon and start commercialisation. The company will start development work for four inhaler products also. Meanwhile, the first set of product launch and its commercialization has already started.
ICICI Prudential Life Insurance Company | BSE Code: 540133 | CMP: 345 | FV: 10 | Market Cap (F.F): 49,512 Crore
In India, the sum assured as percentage of GDP is low as compared to other countries which is below average and stood at 60 per cent. The protection gap for India stood at Rs 583 trillion. Indian economy is set for sustained growth fuelled by favourable demographics and rising consumption. The growth rate of total premium written by the insurance industry has outpaced the GDP growth rate over the period of FY02-FY16. Considering strong opportunity in insurance sector, ICICI Prudential Life Insurance Company is likely to benefit from demand growth in future.
ICICI Prudential Life Insurance Company’s market share expanded by 90 basis points to 13 per cent in 9MFY17 within the industry on a yearly basis. Its market share within private sector also expanded by 100 basis points to 24.5 per cent in 9MFY17, as compared to the same period in the previous fiscal.
On the financial front, ICICI Prudential Life Insurance Company’s protection APE grew by over 100 per cent compared to 25.4 per cent for saving, resulting in an increase in its protection mix from 2.2 per cent to 3.9 per cent for 9MFY17. The company’s new business sum assured rose from Rs 1.03 trillion in 9MFY16 to Rs 2.05 trillion in 9MFY17.
ICICI Prudential Life Insurance Company’s total income increased 66.28 per cent to Rs 23,076 crore in 9MFY17, as compared to the same period in the previous financial year. The company’s net profit also rose 2.13 per cent to Rs 1,274 crore in 9MFY17 on a yearly basis.
The company has very strong capital position and consistently delivered ROE of more 30 per cent for the FY12-FY16 period. It has robust and sustainable business model with low interest rate risk and strong focus on quality metrics.
Larsen & Toubro | BSE Code: 500510 | CMP: 1445 | FV: 2 | Market Cap (F.F): 1,18579 Crore
Larsen & Toubro (L&T) is multifunctional conglomerate having businesses in various verticals. After demerging its IT and technology services business through initial public offer, the company is trying to focus on each of the segments separately.
L&T’s order inflow increased 3.01 per cent to Rs 95,700 crore in Q3FY17 as compared to the same period in the previous fiscal. The company’s total order book stood at Rs 258,600 crore with a growth of 1 per cent in Q3FY17 on a yearly basis.
On the financial front, L&T’s revenue increased 6 per cent to Rs 73,183 crore in 9MFY17 as compared to the same period of previous financial year. The company has earned 36 per cent of total revenue from international segment. Its EBITDA rose 14 per cent to Rs 6,712 crore in 9MFY17 on a yearly basis. L&T’s PAT boosted 59 per cent to Rs 3017 crore in 9MFY17 as compared to the same period in the previous financial year.
On segmental revenue front, L&T has earned 45 per cent from infrastructure, 10 per cent from hydrocarbon, 10 per cent from IT and technology services, 9 per cent from financial services, 7 per cent from power, 4 per cent from developmental project, 4 per cent from electrical and automation, 3 per cent from heavy engineering and remaining 8 per cent from others in 9MFY17.
L&T’s ROE and ROCE stood at 13.16 per cent and 11.16 per cent, respectively, in FY16. The company has debt-to-equity ratio of 2.57x in FY16. It has interest coverage of 1.99x in FY16.
On the valuation front, L&T’s share price is trading at PE multiple of 24.55x, as against industry peers NCC (42.24x), KEC International (18.13x). Meanwhile, the industry is trading at PE multiple of 18.77x. The company has given dividend yield of 1.27 per cent to its shareholders.
Grasim Industries | BSE Code: 500300 | CMP: 911 | FV: 2 | Market Cap (F.F): 29.335 Crore
Continuing government spending on infrastructure, development of smart cities, interest rate cuts supported by interest subsidy schemes for housing will be the key demand drivers for cement. Grasim Industries is well-poised to reap the benefits of investment in the growth plans of its businesses with the sustained growth in the Indian economy.
Grasim Industries net debt-to-equity ratio has come down from 0.1x in Q2FY17 to zero in Q3FY17. The company has plans for capex of Rs 1,780 crore in FY17, out of which Rs 1,125 crore has been already spent in 9MFY17. It will also spend Rs 2,845 crore on capex from FY18 onward.
Grasim industries has received approvals from the stock exchanges and Competition Commission of India for the scheme of merger of Aditya Birla Nuvo with Grasim and subsequent listing of the financial services business. The transaction is expected to be completed by H1FY18.
On the financial front, Grasim Industries’ revenue increased 4.15 per cent to Rs 26,073 crore in 9MFY17, as compared to the same period in the previous financial year. The company’s EBITDA too rose 23.43 per cent to Rs 6,190 crore in 9MFY17 on a yearly basis. Its net profit also boosted by 40.5 per cent to Rs 2,404 crore in 9MFY17 as compared to the same period in the previous fiscal.
Grasim Industries’ VSF business will continue to focus on expanding the VSF market in India by partnering with the textile value chain, achieving better customer connect through the Liva brand and enriching the product mix through a larger share of specialty fibre. The company has identified debottlenecking opportunities to meet the growing demand.
The demand for caustic soda in India is expected to grow with the rising demand from the end-user industry. The company’s plan to increase its caustic soda capacity by 2.08 lakh TPA to 10.48 lakh TPA through brownfield expansion at Vilayat (Gujarat), while debottlenecking at other plants is on track.
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Methodology And Financial Snapshot of 250 Data On Large Cap With Ranking
We bring to you the 250 large-cap stocks which have the highest market cap, sales and net profit. We have used two parameters of financial performance - sales and net profit - to arrive at the company with highest sales and net profit. To evaluate on the market data, we have used market capitalisation as the third parameter to evaluate the company. Also, when we talk about large caps, dividend is an important factor to consider. We have evaluated the companies' dividend by rebasing the dividend on FV of 10 to equate the metrics for measuring the returns to the investors. Apportioning equal weights to these four parameters, we assigned a cumulative rank to companies. Please note that we have evaluated the data in the last week of December 2016, so all market data and financials are as available at that point in time. We hope our ranking provides readers a barometer for evaluating companies. (All data source from : Dion Global Solutions Ltd.
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