Sterlite Industries - Result Review - Angel Broking

Sterlite Industries (Sterlite) reported lower than expected 1QFY2014 results on both top line and net profit front. Net sales declined 22.7% yoy to Rs.8,190cr (below our estimate of Rs.8,372cr). Net sales decline was mainly in the copper segment due to temporary shutdown of the Tuticorin copper smelter in this quarter which was partially offset by higher revenues from power segment due to higher power sales from the Jharsuguda power plant. Copper segment revenues declined 52.3%yoy to Rs.2,446cr. On the operating front, Sterlite's EBITDA declined 5.9% yoy to Rs.2,173cr and EBITDA margin was 26.5% (below our estimate of 28.6%) mainly due loss of Rs.51cr and Rs.26cr in the copper and aluminium segment respectively and hence adjusted net profit decreased by 18.0% yoy to Rs.1,164cr, which was below our estimate of Rs.1,198cr.

We maintain our Buy rating on the stock with a target price of Rs.100.

Source : Equity Bulls

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