Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us    

| More

Result Update: Bluedart Express Ltd - SELL - TP Rs.3215 - Kotak

Posted On: 2018-08-05 07:54:50

Bluedart has reported weak set of numbers for Q1FY19, post strong quarterly performance in Q4FY18. We attribute the current quarter's performance to a challenging environment with slowing business growth, hyper-active competitive pressures in B2B and B2C, increase in fuel prices, introduction of GST and initial hiccups in e-way bill implementation.

Key Highlights

- Sales was in line with expectation at Rs 7.32 bn (+9.9% YoY). However, operational performance of the company was under pressure on account of increase in freight (including fuel) and Employee cost. Freight and handling cost was high for the company during the quarter at Rs 4.86 bn (+12.9% YoY) primarily due to increasing fuel prices, which we believe the company was not able to pass on to customers completely. The employee cost was higher during the quarter at Rs 1.32 bn (+12% YoY) due to year end provisioning of hikes and variable pay by the company

- Other income and depreciation cost were stable for the company, while interest cost has fallen with one-third redemption of debentures in Q3FY18. Lower tax provisioning net of tax adjustment of prior period supported the PAT. Consequently, company reported PAT of Rs 220 mn (-35.7% YoY) which was below our expectation of Rs 350 mn. We consider the current quarter's performance as weak.

Valuation and Outlook

- Bluedart is an undisputed market leader in the air express segment, with a dominant market share of ~50%. It is also a strong player in the ground express cargo segment with a market share of ~13%. A fresh strategy under the observation of Mckinsey, implementation of GST and above normal growth in the ecommerce segment are expected to keep the growth momentum healthy for BLUEDART. However, competition and increasing fuel prices have deflated operational performance on a sustained basis including the current quarter.

- We believe that, the company would find it difficult to pass on the increase in fuel prices and other cost and charge a significant premium for its services to other courier companies. We have also seen a slowing trend of business flow from e-commerce companies to private courier companies. We see the changes as structural in nature which is consistent with our view of crude touching $80 to $90 in medium term. In lieu of this developments, we have lowered our earnings and target multiple accorded to Bluedart. We are now recommending a SELL on Bluedart with a reduced target price of Rs 3215 (from Rs 4050) at 38 x FY20 earnings (lowered from 40x).

Shares of BLUE DART EXPRESS LTD. was last trading in BSE at Rs.3670.05 as compared to the previous close of Rs. 3601.55. The total number of shares traded during the day was 178 in over 75 trades.

The stock hit an intraday high of Rs. 3698 and intraday low of 3634.15. The net turnover during the day was Rs. 652990.

Source: Equity Bulls

Click here to send ur comments or to

Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only., its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.

Other Headlines:

Auto Industry Volume Update: September 2018 - Kotak

Sector Update - Natural Gas - Kotak

Company Visit Note: Jindal Stainless Ltd - NOT RATED - Kotak

Company Update: Bajaj Electricals Ltd - ACCUMULATE - TP Rs.545 - Kotak

Telecom: 2QFY19 preview - no respite - Kotak

Sector Update: Natural Gas - Kotak

Company Update: NBCC (India) Ltd - BUY - TP Rs.95 - Kotak

Sector Update: Paper Industry - Kotak

Management Meet Update: Maharashtra Seamless Ltd - BUY - TP Rs.805 - Kotak

Mid-Year FY19 Bank Outlook: Stress in Non-Corporate Segments - India Ratings and Research

View on proposed banks merger

Company Update: GHCL - BUY - TP Rs.330 - Kotak

Company Update: MIRC Electronics Ltd - BUY - TP Rs.32 - Kotak

Company Visit Note: Finolex Industries Ltd - ACCUMULATE - TP Rs.671 - Kotak

Company Update: NMDC Ltd - BUY - TP Rs.125 - Kotak

Company Update: Allcargo Logistics Ltd - BUY - TP Rs.145 - Kotak

Company Update: Hindustan Zinc Ltd - ACCUMULATE - TP Rs.300

Buyback Offer: Larsen & Toubro Ltd - BUY - Buyback Price Rs.1500

Result Update: Vascon Engineers Ltd - BUY - TP Rs.48 - Kotak

Result Update: Voltamp Ltd - BUY - TP Rs.1320 - Kotak

Result Update: Bodal Chemicals Ltd - REDUCE - TP Rs.130 - Kotak

Result Update: MIRC Electronics Ltd - ACCUMULATE - TP Rs.32 - Kotak

Result Update: Shankara Building Products Ltd - BUY - TP Rs.2017 - Kotak

Result Update: Dilip Buildcon Ltd - BUY - TP Rs.1276 - Kotak

Result Update: Zensar Technologies Ltd - ACCUMULATE - TP Rs.1373 - Kotak

Result Update: The India Cements Ltd - REDUCE - TP Rs.112 - Kotak

Result Update: Nagarjuna Construction Co Ltd - BUY - TP Rs.151 - Kotak

Result Update: Berger Paints Ltd - SELL - TP Rs.305 - Kotak

Result Update: Allcargo Logistics Ltd - BUY - TP Rs.145 - Kotak

Result Update: Aksharchem (India) Ltd - REDUCE - TP Rs.533 - Kotak

Result Update: AIA Engineering Ltd - SELL - TP Rs.1700 - Kotak

Result Update: Cummins India Ltd - BUY - TP Rs.785 - Kotak

Result Update: Dollar Industries Ltd - BUY - TP Rs.427 - Kotak

Result Update: KNR Constructions Ltd - BUY - TP Rs.283 - Kotak

Result Update: Finolex Industries Ltd - ACCUMULATE - TP Rs.671 - Kotak

Result Update: MOIL Ltd - BUY - TP Rs.260 - Kotak

Result Update: VRL Logistics Ltd - BUY - TP Rs.395 - Kotak

Result Update: Voltas Ltd - ACCUMULATE - TP Rs.658 - Kotak

Result Update: Va Tech Wabag Ltd - BUY - TP Rs.476 - Kotak

Result Update: Mahindra Holiday Resorts India Ltd - BUY - TP Rs.390 - Kotak

Result Update: Sterling Tools Ltd - ACCUMULATE - TP Rs.418 - Kotak

Result Update: MRPL - BUY - TP Rs.106 - Kotak

Result Update: Indraprastha Gas Ltd - SELL - TP Rs.257 - Kotak

Result Update: Engineers India Ltd - BUY - TP Rs.187 - Kotak

Initiating Coverage: Amber Enterprises - BUY - TP Rs.1145 - Kotak

Karia Can Company Ltd Q1FY19 net profit slips to Rs. 1.88 crore

Result Update: Bajaj Electricals Ltd - SELL - TP Rs.545 - Kotak

Result Update: Gabriel India Ltd - BUY - TP Rs.185 - Kotak

Result Update: Blue Star Ltd - ACCUMULATE - TP Rs.743 - Kotak

Result Update: The Phoenix Mills Ltd - ACCUMULATE - TP Rs.707 - Kotak

Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2018