Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

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Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

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Equity Bottom-Up

Kolte Patil Developers / Equity Bottom-Up

<ul>
<li>Kolte Patil reported weaker than expected Q3FY23 accounting earnings due to slight delay in arrival of OC for some projects. However, sales velocity and business development activity was robust.</li>
<li>Reported Q3FY23 earnings had weak margins due to revenue contribution from two low-margin projects.</li>
<li>Q4FY23 is on track to be strong both in terms of reported earnings (which depends on the timing of OC) and sales velocity.</li>
</ul>


Kolte Patil reported weaker than expected Q3FY23 accounting earnings due to slight delay in arrival of OC for some projects. However, sales velocity and business development activity was robust.
Reported Q3FY23 earnings had weak margins due to revenue contribution from two low-margin projects.
Q4FY23 is on track to be strong both in terms of reported earnings (which depends on the timing of OC) and sales velocity.


Kolte Patil: Q4FY23 Is All Set to Bring a Strong Close to FY23

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

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Thematic (Sector/Industry)

<ul><li>LIC Housing Finance: LICHF’s earnings continued to remain sub-par with P&amp;L outcomes significantly below estimates</li><li>Credit costs shot up to ~120bps (annualised), as the company shored up its Stage-III provisions to 51% (Q2FY23: 44%) in order to maintain healthy provisioning levels</li><li>While there were low incremental impairments (no write-offs during Q3), the slow pace of resolutions, particularly in project loans (GS-III at ~46%), remains a concer.</li></ul>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.

LIC Housing Finance: LICHF’s earnings continued to remain sub-par with P&amp;L outcomes significantly below estimatesCredit costs shot up to ~120bps (annualised), as the company shored up its Stage-III provisions to 51% (Q2FY23: 44%) in order to maintain healthy provisioning levelsWhile there were low incremental impairments (no write-offs during Q3), the slow pace of resolutions, particularly in project loans (GS-III at ~46%), remains a concer.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.

HSIE Results Daily: LIC Housing Finance, Vinati Organics, The Ramco Cements

<ul>
<li>Q2FY23 results were subdued due to delay in launch of a few new projects. </li>
<li>Lower proportion of sales from Mumbai led to decline in realization by 9% QoQ, however, this has quarterly variation and was also impacted by delay in new project launches.</li>
<li>The current quarter sales seem to be a temporary blip as most of the new projects are on track to launch in Q3FY23.</li>
</ul>


Q2FY23 results were subdued due to delay in launch of a few new projects. 
Lower proportion of sales from Mumbai led to decline in realization by 9% QoQ, however, this has quarterly variation and was also impacted by delay in new project launches.
The current quarter sales seem to be a temporary blip as most of the new projects are on track to launch in Q3FY23.


Kolte Patil: Temporary Blip in Q2FY23 Earnings; On Track for a Strong FY23

<ul>
<li>As highlighted in our previous note, <a href="https://www.smartkarma.com/entities/kolte-patil-developers-ltd" target="_blank" data-smartkarma-citation="entities:6819:1" rel="noopener">Kolte Patil Developers (KPDL IN)</a> is on track to post excellent FY23 earnings.</li>
<li>While new project launches were subdued in Q1FY23 with just one launch, Kolte Patil was able to post decent Q1FY23 sales volume of 0.61 MSF led by sustenance sales.</li>
<li>Kolte Patil has guided to be on track to deliver 3.3+ MSF in FY23. More importantly, it is on track to acquire new projects with topline worth INR 7000cr.</li>
</ul>


As highlighted in our previous note, Kolte Patil Developers (KPDL IN) is on track to post excellent FY23 earnings.
While new project launches were subdued in Q1FY23 with just one launch, Kolte Patil was able to post decent Q1FY23 sales volume of 0.61 MSF led by sustenance sales.
Kolte Patil has guided to be on track to deliver 3.3+ MSF in FY23. More importantly, it is on track to acquire new projects with topline worth INR 7000cr.


Kolte Patil: On Track for an Excellent FY23

<ul><li>ONGC: We maintain our BUY recommendation on ONGC with a target price of INR 178, based on (1) increase in crude price realisation and (2) improvement in domestic gas price realisation</li><li>Q1FY23 revenue/EBITDA/APAT stood at INR 423/259/152bn, below our estimates, owing to higher other expenses, depreciation and interest cost, partially offset by higher-than-expected other income</li><li>Crude oil and gas production were broadly in line, but total crude oil sales, including JV share, came below estimates. Trent: Trent reported a stellar Q1 print</li></ul>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.

ONGC: We maintain our BUY recommendation on ONGC with a target price of INR 178, based on (1) increase in crude price realisation and (2) improvement in domestic gas price realisationQ1FY23 revenue/EBITDA/APAT stood at INR 423/259/152bn, below our estimates, owing to higher other expenses, depreciation and interest cost, partially offset by higher-than-expected other incomeCrude oil and gas production were broadly in line, but total crude oil sales, including JV share, came below estimates. Trent: Trent reported a stellar Q1 printContent 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.

HSIE Results Daily: ONGC, Trent, Phoenix Mills, Fine Organic Industries

India

Kolte-Patil Developers Ltd. builds residential housing, commercial complexes, and mixed residential and commercial projects.

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Kolte Patil Developers (KPDL IN)

Kolte Patil: Q4FY23 Is All Set to Bring a Strong Close to FY23

An investment in Kolte Patil offers an upside potential of 50%. Kolte Patil is on track to post a strong FY23 and is guiding for another 25-30% pre...

Ankit Agrawal, CFA

HSIE Results Daily: LIC Housing Finance, Vinati Organics, The Ramco Cements

Credit costs shot up to ~120bps (annualised), as the company shored up its Stage-III provisions to 51% (Q2FY23: 44%) in order to maintain healthy...

HDFC Securities

Kolte Patil: Temporary Blip in Q2FY23 Earnings; On Track for a Strong FY23

KPDL has significant re-rating potential led by strong earnings for H2FY23. It is on track to post INR 180cr+ of PAT for FY23. At current...

Ankit Agrawal, CFA

Kolte Patil: On Track for an Excellent FY23

Kolte Patil is on track to post a strong FY23 in line with our prior note. It is expected to fire on cylinders - sales velocity, deliveries and new...

Ankit Agrawal, CFA

HSIE Results Daily: ONGC, Trent, Phoenix Mills, Fine Organic Industries

Crude oil and gas production were broadly in line, but total crude oil sales, including JV share, came below estimates. Trent: Trent reported a...

HDFC Securities

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