The brokerage pegs the company’s revenues at Rs 3,099.9 crore, a decline of 60 per cent year-on-year (YoY) from Rs 7,755.8 crore logged in the corresponding quarter of FY20. Sequentially, the drop would be 54.5 per cent compared to Rs 6,815.9 crore of Q4FY20.
“We expect revenue to decline by nearly 60 per cent YoY. Besides, realisations and margins are expected to be adversely impacted by lower share of 3Ws (down to 10 per cent from 13 per cent in Q1FY20),” noted the brokerage in a results expectations report.
It, however, expects the decline in net profit to be cushioned by higher other income. Profit after tax (PAT) is seen at Rs 646.4 crore, down about 43 per cent YoY and 51 per cent QoQ.
Analysts at the firm brokerage foresee the net profit mildly lower than Edelweiss Securities’ estimate at Rs 627.3 crore, down 44.3 per cent YoY from Rs 1,125.7 crore clocked in Q1FY20. That apart, they see the EBITDA (earnings before interest, tax, depreciation and amortisation) at Rs 404.2 crore. However, EBITDA margins, they say, could contract about 222 bps YoY to 13.2 per cent from 15.4 per cent due to a lower scale. In the March quarter of FY20, the EBITDA margin was 18.4 per cent.
“Realizations are expected to increase due to price hikes led by BV-VI transition, safety norms, cost inflation, and rupee depreciation, despite adverse 3W mix,” they said.
The brokerage is rather conservative in its estimates and sees the EBITDA margins contracting sharply to 9.1 per cent in the recently concluded quarter on weaker product mix and operating leverage impact. EBITDA, Nomura says, could plunge 79 per cent and 80 per cent, respectively on a yearly as well as quarterly basis to Rs 255.8 crore. In the year-ago period, the EBITDA was Rs 1,198.2 crore, while the same was Rs 1,252.8 crore in Q4FY20. Net profit is seen at Rs 522.2 crore.
Motilal Oswal Financial Services
According to the analysts, the company’s exports could come under threat due to volatile crude oil prices. Besides, the adverse H1FY21 mix, due to weak 3W volumes, could be diluted by favorable rupee.For the 443,000 units sold in Q1FY21, the brokerage sees realisation at Rs 6,527.5 crore, up 5 per cent YoY, from Rs 6,218.7 crore. Sequentially, it is a decline from Rs 6,871.1 crore reported in Q4FY20. That apart, profit before tax, but after extraordinary, is seen at Rs 566 crore, down from Rs 1,578.8 crore clocked in Q1FY20 and Rs 1,721.2 crore in Q4FY20.
“The volume mix has been favourable with higher share of exports and BS-VI resulting in increase in expected realisations by 12.7 per cent YoY. We expect margins to decline by 290bps YoY and 590 bps QoQ to 12.5 per cent led by negative operating leverage,” said analysts in a pre-result note. The brokerage foresees the EBITDA at Rs 388.2 crore, and profit before tax at Rs 829.2 crore. The net profit is pegged at Rs 620.5 crore.
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