Talwalkars Better Value Fitness (Q4 FY14)

India Infoline News Service | Mumbai |

Volume growth was supported by addition of 14 fitness centres in FY14.

CMP Rs176, Target Rs204, Upside 16.0% 
  • Talwalkars’ reported 17.7% yoy rise in net revenues driven by growth in value added services and gym additions

  • Operating synergies and sourcing benefits support 190bps yoy margin expansion to 58.2%

  • Higher finance costs due to short term loans offset by lower minority interest; PAT up a healthy 22.6% yoy

  • Company added 14 fitness centres during the fiscal and posted ~24%/22% rise in FY14 revenues/PAT

  • Remain +ve on growth prospects along with scope for same store sales improvement; retain BUY with revised target of Rs204 

Result table
(Rs m) Q4 FY14 Q4 FY13 % yoy FY14 FY13 % yoy
Gross sales 659 558 18.1 2,095 1,688 24.1
Less: service tax (70) (60) 16.8 (222) (179) 23.7
Service tax (%) 10.6 10.7 - 10.6 10.6 -
Net sales 589 498 18.2 1,873 1,509 24.1
Other op income 4 5 (32.9) 11 13 (17.6)
Revenues 593 504 17.7 1,884 1,522 23.8
Staff (93) (83) 13.1 (359) (312) 15.0
Admin & other expenses (154) (137) 12.2 (587) (471) 24.6
Operating profit 345 284 21.6 938 739 27.0
OPM (%) 58.2 56.4 190 bps 49.8 48.6 124 bps
Depreciation (45) (41) 11.9 (242) (146) 65.1
Interest (37) (21) 70.5 (120) (108) 10.9
PBT 263 222 18.7 576 484 19.0
Tax (108) (90) 20.7 (178) (158) 12.7

***Note: This is a NSE Chart

 

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