Greaves Cotton - Q1FY21 First Cut - ICICI Securities

(CMP: Rs. 87; MCap: Rs. 2,022 crore)

Greaves Cotton Ltd reported muted operating performance for Q1FY21, while topline growth still remains a key concern on the back of slowdown in core engine business amid covid-19 disruptions and BS VI transition.

Q1FY21 Earnings Summary

- Standalone revenues came in at Rs. 147.1 crore, which declined by 69.2% on YoY, (below our estimates of Rs. 175.8 crore). The engine segment revenues came in at Rs. 140 crore which declined by 67.7% YoY. E-Mobility segment revenue declined by 52.5% to Rs. 8.9 crore due demand and supply side disruptions amid covid-19

- At EBITDA level, it registered a loss of Rs. 21.7 crore on YoY (Vs. EBITDA of Rs. 61.3 crore in Q1FY20) owing to higher employee expenses, other operating expenses and lesser booking of revenues. While gross margin has declined by ~400bps to 28% on YoY basis

- Loss after tax came in at Rs. 24.2 crore (Vs. PAT of Rs. 39.8 crore in Q1FY20), partially impacted by only marginal decline of 4% in depreciation and much lower other income which declined by 71% to Rs. 2.2 crore on YoY

Greaves cotton's posted weak performance owing to demand & supply side disruptions amid lockdowns while EBITDA deteriorated due to lesser revenue booking and under absorbed operating cost amid covid-19.

We would come out with a detailed report post the Conference call.

Shares of GREAVES COTTON LTD. was last trading in BSE at Rs.83.7 as compared to the previous close of Rs. 87.45. The total number of shares traded during the day was 47682 in over 1043 trades.

The stock hit an intraday high of Rs. 87.25 and intraday low of 83.5. The net turnover during the day was Rs. 4024081.

Source : Equity Bulls

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