HUL: Fair, not so lovely

 The other weak spot in the March quarter numbers is that HUL's foods and beverage business continues to decelerate: at 15 per cent, the growth is below the levels seen in the last four quarters on a very small base of just Rs 531 crore.  Probably because it hasn't entered mass categories, HUL seems unable to scale up the business significantly. At the current price of Rs 247, the stock trades at over 25 times estimated CY08 earnings and is somewhat expensive given that earnings growth over the next couple of years should range between 17-18 per cent.  Siemens: Poor execution  If any sector is turning in nasty surprises in the current earnings season, it's the capital goods space. After the shocker from BHEL which reported an increase in gross revenues of just 15 per cent for the March 2008 quarter, came some weak numbers from ABB, which posted a sales growth of just 17 per cent.

How companies are grappling with execution issues is evident from the 86 per cent crash in the operating profit of the Rs 9,417 crore Siemens.

The engineering major has reversed revenues of Rs 120 crore, booked on some projects which are now in trouble and has provided for estimated losses of Rs 110 crore, partly for cost overruns.

Even adjusted for exceptionals, the turnover rose just 11 per cent, while the unadjusted operating margins plummeted 770 basis points to 1.2 per cent