Apollo Hospitals Enterprise
CMP: Rs 489
Fair Value: Rs 533
Q4FY11 results has exceeded Crisil Equities' expectations on higher revenues from the newly established hospitals, low interest cost and the decline in losses from associates. We remain upbeat on the growth prospects of the healthcare services industry and Apollo's leadership position in the organised healthcare delivery market. Although Q4FY11 results were above our expectations, we maintain our earnings estimates after factoring in slight delays in commissioning of the new beds. We maintain our fundamental grade of 5/5.
—Crisil Research
Sun Pharma
CMP: Rs 478
Target Price: NA
Sun Pharmaceutical Industries Limited's (SPIL's) performance in Q4FY11 was above street expectations at the operating and net level due to consolidation of Taro financials. SPIL continued to show strong traction in the domestic business, exhibiting a jump of 20 per cent y-o-y in revenues. The management is confident of maintaining its growth rate in the domestic market, driven by new product launches. Taro's acquisition would mark SPIL's foray in the niche dermatology market. Also, the management is keen on looking at oral contraceptives as a therapeutic segment.
—HDFC Securities
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DLF
Reco price: Rs 234
Target price: Rs 237
DLF's March quarter 2011 results were hit by the extra cost recognition. Debt in FY2010-11 remained constant (net D/E: 0.9 times), mainly owing to preferential capital buyouts and further purchase of land. Sales stood at Rs 6,660 crore, but volumes fell below guidance. We downgrade the stock to Hold on slower balance-sheet recovery and lack of clarity on strategy. We cut our Mar '12e target price to Rs 237 from Rs 309. At current market price, the stock trades at 1.5x Mar '12e PBV.
—Anand Rathi Research
Indian Oil Corporation
Reco price: Rs 320
Target price: Rs 350
Indian Oil Corp (IOCL) declared its Q4FY11 results with revenues of Rs 98,722.7 crore, Ebitda of Rs 5,782.7 crore and PAT of Rs 3,905.2 crore. The profitability was above our estimates mainly due to higher refining margins and lower net under-recoveries. Higher product spreads in global markets increased the refining margins to $7.9 per barrel in Q4FY11. We have increased our Brent crude oil prices estimates to $100 per barrel and also assumed net under-recoveries for downstream companies at 8.8 per cent in FY12E and FY13E. This would increase our EPS estimates to Rs 32.1 and Rs 32.7 in FY12E and FY13E, respectively.
—ICICI Direct