Styrolution ABS - 2QCY2013 Result Review - Angel Broking

Styrolution ABS Ltd. (Styrolution) reported mixed set of numbers for 2QCY2013. Top line for the quarter came in flat at Rs. 230cr, lower by 2.4% yoy as compared to our estimate of Rs. 268cr. EBITDA grew marginally by 0.8% yoy and came in at Rs. 15cr, while margins expanded by 20bp yoy to 6.3% owing to lower raw material cost as percentage of sales. The company was able to pass on the additional imported raw material cost due to currency volatility to the customers and thereby sustain the operational margins. Net profit plunged by 14.7% yoy to Rs. 8.3cr on account of lower other income (by 7.0% yoy) and higher tax outgo (39.5% of PBT as compared to 29.3% in 2QCY2012).

We have revised our estimates downwards but continue to maintain Buy rating on the stock with the revised target price of Rs. 492, based on target PE of 14x for CY2014E.

Source : Equity Bulls

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