Castrol India - March 2013 Results Preview - Motilal Oswal

- We expect revenues to grow 5.7% YoY to INR8.3b. We have assumed volume growth of -1% YoY and realization growth of 6.8% YoY.

- For CY13, we have assumed volume growth of 2.4% YoY and realization growth of 4.2% YoY.

- EBITDA margin is likely to expand 159bp YoY to 21.6%, primarily driven by lower raw material cost and recent price hikes.

- We model 1.9% YoY increase in net profit to INR1.25b.

- CSTRL trades at 28.7x/26.3x CY13E/CY14E earnings. Our DCF-based target price is INR316. Though we remain positive on the company's long-term prospects, we maintain Neutral, given rich valuations.

Source : Equity Bulls

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