Ballarpur Industries - Q3FY12 Result Update - Emkay

Reco: ACCUMULATE
CMP: Rs 24
Target Price: Rs 35

Sabah shutdown affected results

- Q2FY12 results disappointed due to continued margin pressures. Consol revenues of Rs 12bn, +7% yoy were above est however APAT at Rs 136mn, -72% was below est

- Consol EBITDA margins at 15.7% (-360 bps yoy / -270bps qoq) are at their all time low. Margin decline is primarily on account of shutdown at SFI Plant

- Paper realisation remain flat at Rs 44,752/mt, however companies have started taking price increase (recent increase of 3-4%) due to cost pressure (mainly coal)

- Reduce FY12 est by 31% to Rs 2.1 due to weak Q2FY12 results & continued margin pressure in paper industry. Maintain Accumulate with target of Rs 35.

Source : Equity Bulls

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