SKF India Q3FY17: Fundamental Analysis - Firstcall India Equity
Firstcall India Equity | May 24, 2016, midnight
SKF India Ltd is a leading global supplier of bearings, seals, mechatronics, lubrication systems, and services which include technical support, maintenance and reliability services, engineering consulting and training.
The company achieved a turnover of Rs.7151.00 mn for Q3 FY17 as against Rs.6577.50 mn in Q3 FY16, up by 8.72%.
During the 3rd quarter, net profit increased by 16.14% to Rs.653.40 mn from Rs.562.60 mn in the corresponding quarter ending of previous year.
During the 3rd quarter, EBIDTA stood at Rs. 1136.80 mn as against Rs. 1004.10 mn in the corresponding period of the previous year.
Profit before tax (PBT) stood at Rs.1017.60 mn in Q3 FY17 as against Rs.874.70 mn in the corresponding quarter of the previous year, up by 16.34%.
During 9M FY17, net sales of the company increased to Rs. 2130860 mn from Rs. 19714.60 mn in 9M FY16, up by 11.13%.
EPS of the company stood at Rs.12.39 in Q3 FY17 against Rs. 10.67 in the corresponding quarter of the previous year.
Net Sales and PAT of the company are expected to grow at a CAGR of 8% and 14% over 2015 to 2018E, respectively.
OUTLOOK AND CONCLUSION
At the current market price of Rs. 1457.60, the stock P/E ratio is at 30.82 x FY17E and 27.46 x FY18E respectively.
Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 47.29 and Rs. 53.09 respectively.
Net Sales and PAT of the company are expected to grow at a CAGR of 8% and 14% over 2014 to 2018E respectively.
On the basis of EV/EBITDA, the stock trades at 16.08 x for FY17E and 14.44 x for FY18E.
Price to Book Value of the stock is expected to be at 4.23 x and 3.66 x for FY17E and FY18E respectively.
Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.