Cox & Kings (Q3 FY14)

India Infoline News Service | Mumbai |

C&K Q3 revenues increased ~14% yoy driven by 50% yoy jump in Education sales as Meininger business was consolidated from April 2013

CMP Rs139, Target Rs145, Upside 4.3% 
  • C&K Q3 revenues increased ~14% yoy driven by 50% yoy jump in Education sales as Meininger business (revenues ~Rs310mn/1.8bn in Q3/9m FY14) was consolidated from April 2013

  • India leisure revenues/EBIDTA grew 14%/16% yoy supported by overseas travel and inbound business; International leisure division revenue/EBIDTA of -8%/+33% excluded Djoser business sold in February 2013

  • Q3 is a seasonally lean period for Education though newly consolidated Meininger business performed well; forward bookings for FY15 (ex-Meininger) appear robust at 60%; Camping forward bookings achieved 61% of FY15 target

  • EBIDTA margin jumped as Q3 FY13 included exceptional expenses associated with redundancies in HBR as well as supported by a weaker INR; reported PAT included FX gain of Rs392mn vs Rs530mn a year ago  

  • We revisit our earnings estimates for FY14/15 and introduce FY16 forecasts and in view of current valuations, downgrade the stock to Market Performer with revised 9-12mth target of Rs145 (earlier Rs135) 

Results table (consolidated)
(Rs m) Q3 FY14 Q3 FY13 % yoy 9m FY14 9m FY13 % yoy
Net sales 4,077 3,572 14.1 18,127 15,781 14.9
Staff costs (1,913) (1,685) 13.5 (6,352) (5,412) 17.4
Advt expenses (256) (383) (33.0) (853) (989) (13.8)
Other expenses (855) (1,025) (16.6) (2,566) (2,632) (2.5)
Operating profit 1,053 479 119.8 8,356 6,748 23.8
OPM (%) 25.8 13.4 1,241 bps 46.1 42.8 334 bps
Depreciation (297) (277) 7.2 (1,437) (1,301) 10.4
Interest (887) (851) 4.2 (2,473) (2,633) (6.1)
Other income 246 298 (17.3) 394 241 63.8
PBT 115 (352) - 4,840 3,055 58.4
Tax (121) (81) 49.2 (1,672) (1,538) 8.7
Effective tax rate (%) 33.1 - - 24.5 36.9 (1,243) bps
Minority interest & Associate share 64 93 (31.0) (858) 351 -
Exceptional items 251 373 (32.7) 1,985 1,110 78.8
Reported PAT 309 33 826.0 4,294 2,978 44.2
Source: Company, India Infoline Research
 
Segment wise highlights
Revenues Q3 FY14 Q3 FY13 % yoy
Leisure 2,710 2,750 (1)
Education 1,170 780 50
Camping 120 - -
Others 80 40 100
Total 4,080 3,570 14
EBIDTA Q3 FY14 Q3 FY13 % yoy
Leisure 1,040 830 25
Education 310 (70) -
Camping (270) (260) 4
Others (20) (30) (33)
Total 1,060 470 126
Source: Company, India Infoline Research
 
Financial summary
Y/e 31 March  (Rs m) FY13 FY14E FY15E FY16E
Revenues 18,087 22,006 24,129 26,571
yoy growth (%) 115.9 21.7 9.6 10.1
Operating profit 7,225 9,242 10,207 11,239
OPM (%) 39.9 42.0 42.3 42.3
Reported PAT 2,484 4,384 3,448 4,261
yoy growth (%) 497.1 76.5 (21.3) 23.6
EPS (Rs) 18.2 32.1 25.3 31.2
P/E (x) 7.5 4.3 5.4 4.4
P/BV (x) 1.7 1.2 1.0 0.8
EV/EBITDA (x) 6.6 4.6 3.8 3.0
Debt/Equity (x) 3.8 2.4 1.8 1.3
ROE (%) 21.6 33.1 20.3 20.6
ROCE (%) 10.5 12.9 14.3 15.8
Source: Company, India Infoline Research

***Note: This is a NSE Chart

 

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