Tulip Telecom (Q5 FY12)

India Infoline News Service | Mumbai |

Tulip reported 8.3% qoq jump in revenues, an improvement from 3.6% sequential fall in Q4 topline though yoy revenue rise of 9.6% indicate a difficult revenue environment compared to previous quarters.

CMP Rs106, Target Rs85, Downside 19.7%

  • Tulip reported 8.3% qoq jump in revenues, an improvement from 3.6% sequential fall in Q4 topline though yoy revenue rise of 9.6% indicate a difficult revenue environment compared to previous quarters.
  • Strong cost control over SG&A (down 115bps qoq) and staff (-24bps qoq) as company continues focus on cost rationalization led to 122bps qoq rise in margin; Adjusted for Rs616mn in post tax gain on sale of 13% stake in Qualcomm’s BWA venture, Tulip reported ~17% decline in PAT purely driven by net tax credit to the tune of Rs43mn in Q4 FY12.
  • Data centre won an order worth Rs872mn from UIDAI for project ‘Adhaar’ for 3 years which entails 10,000 sq ft of data centre space  
  • Q5 FY12 performance was a relative positive surprise led by sequential revenue growth and margin improvement; however, given the cautious macro environment, we expect revenue growth to remain tepid and margins to be under pressure. We revise our revenue/EBIDTA/PAT estimates post quarterly results but retain SELL with revised 9-mth tgt of Rs85 (earlier Rs71).
Results table (consolidated)
(Rs m) Q5 FY12 Q4 FY12 % qoq Q1 FY12 % yoy
Net sales 7,165 6,617 8.3 6,538 9.6
Traded good/scvs (4,642) (4,276) 8.6 (4,179) 11.1
Staff cost (376) (364) 3.5 (299) 25.9
SG&A (227) (285) (20.5) (213) 6.8
Operating profit 1,920 1,692 13.5 1,848 3.9
OPM (%) 26.8 25.6 122 bps 28.3 (147) bps
Depreciation (628) (604) 3.8 (495) 26.8
Interest (556) (537) 3.5 (319) 74.1
Other income (0) 68 - (11) (97.8)
PBT 736 618 19.1 1,023 (28.0)
Tax (189) 43 - (251) (24.9)
Effective tax rate (%) 25.6 - - 24.5 108bps
Adjusted PAT 547 660 (17.1) 772 (29.1)
Adj. PAT margin (%) 7.6 10.0 (234) bps 11.8 (416) bps
Extra ordinary items 616 -   -  
Reported PAT 1,164 660 76.2 772 50.8
Source: Company, India Infoline Research
 
Financial snapshot: Tulip Data Centres
Rs mn Q5 FY12
Operating profit (143)
Fixed assets (including Rs2.1bn in investments) 3,721
Net current assets 482
Equity funds 2,141
Source: Company
 
Financial summary
Y/e 31 Mar
(Rs m)
FY10 FY11 FY12E* FY13E
Revenues 19,664 23,511 41,238 29,440
yoy growth (%) 21.8 19.6 75.4   (28.6)
Operating profit 5,255 6,631 11,753 7,743
OPM (%) 26.7 28.2 28.5 26.3
Reported PAT 2,743 3,064 4,466 2,322
yoy growth (%)   9.7 11.7 45.7   (48.0)
         
EPS (Rs) 18.9 21.1 30.8 16.0
P/E (x) 5.6 5.0 3.4 6.6
P/BV
BSE 1.53 0.05 (3.38%)
NSE 3.95 [0.20] ([4.82]%)

***Note: This is a NSE Chart

 

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