In today’s briefing:
- Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers
- Bharat Electronics: Mixed Set of Numbers
- KEC International: Weak Numbers but Saved by Non-T&D Segment
- KEC Intl: Margin Pressure to Subside Gradually; Order Book Robust!
- MonotaRO (3064): FY12/22 Guidance Came as a Negative Surprise.
- Wika Gedung (WEGE IJ) – Anticipating jump in FY22F new contract
Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers
US equity markets rallied on Wednesday with the S&P and Nasdaq ending 0.9% and 0.5% higher. Sectoral gains were led by Communication Services up 3.1%, Real Estate and Utilities up 1.5-1.7%. US 10Y Treasury yields eased 2bp to 1.77%. European markets were broadly positive with the CAC and FTSE up 0.2% and 0.6% while DAX was flat. Brazil’s Bovespa closed 0.6% higher. In the Middle East, UAE’s ADX was up 0.2% while Saudi TASI closed 0.8% lower. Asian markets have opened mixed with STI up 2.1% while Nikkei was down 1.1%. Shanghai and HSI remain closed on account of the lunar new year holidays. US IG CDS spreads were 1.3bp wider and HY CDS spreads were 6.2bp wider. EU Main CDS spreads were 0.5bp tighter and Crossover CDS spreads were 0.3bp tighter. Asia ex-Japan CDS spreads were 0.4bp tighter.
Bharat Electronics: Mixed Set of Numbers
- Bharat Electronics (BEL) is leading aerospace and defence electronics company. It primarily manufactures advance electronics products.
- Multi-product, multi-technology- diverse product range including radar, missile systems, electronic warfare & avionics, anti-submarine warfare, electro-optics, home land security, civilian products, etc
- Focus to increase non-defence share to ~20-25% over two to three years
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KEC International: Weak Numbers but Saved by Non-T&D Segment
- KEC International (KEC) is one of the EPC majors in key infrastructure sectors like power T&D, railways, civil, urban infrastructure, solar, smart infrastructure, oil & gas pipelines and cables
- A strategic shift in portfolio from T&D to non-T&D (13% contribution in FY16 increased to 42% in FY21)
- Target Price and Valuation: We value KEC at Rs 535 i.e. 17x P/E on FY24E EPS.
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KEC Intl: Margin Pressure to Subside Gradually; Order Book Robust!
- KEC International (KEC Int) reported a mixed set of numbers in Q3FY22
- The company reported revenues of Rs 3,340 Cr (up 2% YoY), EBIDTA of Rs 239 Cr ( down 20% YoY), and PAT of Rs 94 Cr (down 35% YoY)
- We roll over our estimate to FY24E and value KEC International at 14x FY24E EPS to arrive at a target price of Rs 555/share, implying an upside of 10% from the CMP and maintain a BUY rating on the stock.
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MonotaRO (3064): FY12/22 Guidance Came as a Negative Surprise.
FY12/21 OP 24.1bn yen; Misses the company guidance but exceeds our forecast
Consolidated OP for 4Q (Oct-Dec) was 6.6bn yen (+25.7% YoY, +16.7% YoY), and OPM was 12.8 (vs. 12.1% for 3Q)
FY12/22 guidance should be a negative surprise to the market
Wika Gedung (WEGE IJ) – Anticipating jump in FY22F new contract
Anticipating jump in FY22F new contract
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.
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