Hero Motocorp Preview: ICICI Securities expects revenue growth of 27% YoY largely due to volume growth of 7% YoY and net realisation improvement of 18% due to pass through of the BS-VI price increase. They expect gross margins at 29% (down 313 bps) due to higher raw material costs. EBITDA margin is expected to decline 85 bps YoY.
HDFC Securities highlights Two-wheeler volumes are up 7% YoY, they expect the margin at 12.8% vs. 3.6% margin QoQ, (-175 bps YoY).  They expect PAT to come in flat YoY at Rs 9.2 bn, (Rs 613 mn QoQ).

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Key monitorables for Q2 FY21:

Channel inventory levels, demand outlook and customer response for new products launched, Market share trends in the premium segment post the launch of the Xtreme 160cc and Festive season expectations.

Axis Bank Preview: HDFC Securities expects 10% YoY (+2.5% QoQ) loan growth and a marginal improvement in NIMs are expected to drive core earnings growth of 16% YoY (+1.3% QoQ). Drop in non-interest income (muted core fees and lower treasury gains) will result in PPOP de-growth of 5%/3% YoY/QoQ. HDFC securities have factored in a 13% YoY rise in non-tax provisions. However, as provisions are expected to be much lower QoQ, HDFC Securities expect a sharp QoQ rise in PAT (+59%).

Key monitorables for Q2 FY21 will be:

GNPA and below rated loan pool flux, Deposit traction, Comments on restructuring, Outlook on growth, Additional provisions, Subsidiaries’ performance.

Titan Preview: HDFC Securities highlights that Titan’s recovery has been better than expected. They expect net revenue to decline by 2%, Overall EBIT margin to come off by 230 bps YoY at 7.3%, Jewellery revenue grew 8.7% YoY (consolidated) which includes a Rs. 3.9 bn excess gold inventory sale. Jewellery sales have hit near 98% of the base quarter in Q2. HDFC Securities forecasts a 25% decline in volumes. Expect Jewellery EBIT margins to decline 190 bps YoY to 8.5%. Watches and Eyewear segments have recovered to 55 / 58% of Pre-COVID sales respectively.

Key monitorables for Q2 FY21 will be:

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Sept sales have come off again; hence commentary on recovery is key and consumer sentiments, Outlook on Watches and Eyewear businesses, Jewellery business EBIT margin, Inventory levels and capital base movement in Jewellery.

L&T Preview: HDFC Securities expect Q2 FY21 net sales at Rs 333.5 bn which is 56.6% higher QoQ and 5.6% below YoY sales number. EBITDA is expected to come in at Rs 33.2 bn which is 105% higher QoQ and 17.4% below YoY number. Margins are expected to come at 10% higher by 233.5 bps QoQ vs 143 bps lower than last year. PAT is expected to come at Rs 14.3 bn which is 1722% more that last quarter and 43.5% below last year.