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Indian Hotels Company (Q3 FY14)

Indian Hotels consolidated Q3 revenues grew 10.1% yoy while margins expanded 122bps yoy on lower other overheads

February 13, 2014 5:58 IST | India Infoline News Service
CMP Rs60, Target Rs56, Downside 8.2%
  • Indian Hotels consolidated Q3 revenues grew 10.1% yoy while margins  expanded 122bps yoy on lower other overheads

  • Standalone sales grew at a tepid 3.6% yoy despite Q3 being a seasonally strong quarter for domestic market, an indication of continued weakness in demand; margins remained largely flat yoy as lower license fees and other costs countered higher staff and input expenses 

  • Consolidated PAT up 19.7% yoy and impacted by FX loss to the tune of Rs91mn and lower other income yoy

  • We remain cautious on the demand environment given a weak economy which in turn would restrict margin expansion; revise our FY14/15 estimates and introduce FY16 forecasts but retain Market Performer with revised 9-12mth target of Rs56

Results table (consolidated)
(Rs m)
Q3 FY14
Q3 FY13
% yoy
9m FY14
% yoy
Net sales
11,676
10,605
10.1
29,722
9.0
License fees
(577)
(588)
(1.9)
(1,509)
2.6
Raw material
(1,229)
(1,053)
16.7
(3,161)
12.9
Personnel
(3,544)
(3,188)
11.2
(10,195)
7.6
Power & fuel
(791)
(722)
9.6
(2,324)
7.8
Other overheads
(3,080)
(2,954)
4.3
(8,633)
9.7
Operating profit
2,455
2,100
16.9
3,901
11.5
OPM (%)
21.0
19.8
122 bps
13.1
30 bps
Depreciation
(790)
(723)
9.3
(2,326)
7.0
Interest
(428)
(428)
(0.1)
(1,282)
2.9
Other income
14
131
(89.6)
487
1.3
PBT
1,251
1,079
15.9
781
39.5
Tax
(476)
(480)
(0.7)
(503)
(11.3)
Effective tax rate (%)
41.1
45.2
(412) bps
-
-
Minority int/Associates
(88)
(84)
4.5
(295)
(25.9)
Adjusted PAT
687
516
33.1
(17)
(95.8)
Extra ordinary items
(91)
(18)
401.7
(3,913)

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