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Crisil: Performance Highlights
Crisil: Performance Highlights
Crisil: Performance Highlights
CRISIL
Performance Highlights
Particulars (` cr) Net sales EBITDA EBITDA margin (%) Net profit 2QCY2011 2QCY2010 203.8 60.6 29.7 44.4 151.2 46.9 31.0 33.3 %chg (yoy) 1QCY2011 34.8 29.3 (127) 33.4 178.8 58.3 32.6 46.0 %chg (qoq) 14.0 3.9 (290) (3.3)
NEUTRAL
CMP Target Price
Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code Credit Rating 5,602 0.3 8,400 /5,391 1,033 10 18,436 5,542 CRSL.BO CRISIL@IN
`7,890 -
CRISIL registered strong top-line growth in 2QCY2011. The companys net sales grew by 34.8% yoy to `204cr. The company reported a 127bp yoy contraction in OPM to 29.7%. Net profit increased by 33.4% yoy to `44cr (`37cr). Top line posts strong growth, margin dips yoy: For 2QCY2011, CRISILs top line reported 34.8% yoy growth to `204cr (`151cr), led by strong growth in its research segment, which witnessed 54.4% growth because of addition of Pipals revenue for the full quarter and strong growth in Irevna and CRISIL Research. The rating business also picked up during the quarter, registering strong 19.2% yoy and 17.1 qoq growth. The advisory segment also witnessed an increase in its revenue, registering 20.2% yoy and 46.6% qoq growth. The companys EBITDA margin declined by 127bp yoy, largely due to higher employee cost, which increased to 45.6% of sales from 43.0% of sales. Net profit came in at `44cr, up 33.4% yoy. However, adjusting for other income, net profit increased by 31.7% as the company had sold property worth `3.32cr in 2QCY2011. Outlook and valuation: We expect CRISIL to post a 21% CAGR in revenue over CY201012 and continue to maintain its leadership position. CRISIL benefits from its asset-light business model, which is high on intellectual assets (employee costto-sales is around 40%). Further, the company is debt free and has 40% plus RoE. Additionally, CRISIL enjoys strong parentage (Standard and Poor's). Currently, the stock is available at 22.9x CY2012E earnings, which is at the higher end of its historical range of 16.429.9x one-year forward EPS. With the recent run-up in the stock price, we change our recommendation to Neutral.
Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 52.4 18.4 11.6 17.6
3m (5.9) 20.3
CY2009 537 4.4 161 14.4 223 37.1 35.5 40.6 46.6 13.1 10.1 27.3
CY2010 631 17.5 160 (0.2) 290 34.5 27.3 49.6 47.4 14.2 8.6 25.0
CY2011E 766 21.3 201 25.0 283 34.8 27.9 46.4 55.3 11.9 7.0 20.2
CY2012E 926 20.9 244 21.7 344 35.0 22.9 47.8 58.1 10.2 5.7 16.3
Sharan Lillaney
022-3935 7800 Ext: 6811 sharanb.lillaney@angelbroking.com
2QCY2011 2QCY2010 203.8 143.2 60.6 29.7 7.4 53.2 5.6 58.8 14.4 44.4 21.8 38.8 62.6 151.2 104.3 46.9 31.0 5.0 41.8 3.9 45.7 8.7 3.6 33.3 22.0 29.5 46.1
%chg (yoy) 1QCY2011 34.8 37.3 29.3 (126.8)bp 47.5 27.1 46.3 28.7 33.4 (22.1)bp 31.7 35.8 178.8 120.4 58.3 32.6 6.8 51.5 2.6 54.2 8.2 46.0 25.7 43.4 64.8
%chg (qoq) 14.0 18.9 3.9 (289.8)bp 9.5 3.1 114.8 8.6 (3.3) (391.2)bp (10.5) (3.3)
CY2010 631.1 413.3 217.7 34.5 21.3 196.5 67.7 264.1 58.7 205.5 32.6 137.8 277.0
CY2009 537.3 338.0 199.3 37.1 14.9 184.5 23.0 207.5 46.7 160.8 29.9 137.8 222.5
%chg (yoy) 17.5 22.3 9.2 (259.4)bp 43.1 6.5 194.2 27.3 27.8 263bp 0.0 24.5
40
25.7
21.8
Key ratios
Y/E December Valuation Ratio (x) P/E (on FDEPS) P/E (on basic, reported EPS) P/CEPS P/BV Dividend yield (%) Market cap. / Sales EV/Sales EV/EBITDA EV / Total Assets Per Share Data (`) EPS (Basic) EPS (fully diluted) Cash EPS DPS Book Value Dupont Analysis (%) EBIT margin Tax retention ratio Asset turnover (x) ROIC (Post-tax) Cost of Debt (Post Tax) Leverage (x) Operating ROE Returns (%) ROCE (Pre-tax) Angel ROIC (Pre-tax) ROE Turnover ratios (x) Asset Turnover (Gross Block) Asset Turnover (Net Block) Asset Turnover (Total Assets) Operating Income / Invested Capital Inventory / Sales (days) Receivables (days) Payables (days) Working capital cycle (ex-cash) (days) Solvency ratios (x) Gross debt to equity Net debt to equity Net debt to EBITDA Interest Coverage (EBIT / Interest) 2.7 4.0 1.6 4.2 59 104 (11) 2.9 4.4 1.4 4.0 58 122 (21) 2.6 3.7 1.5 3.5 58 120 (19) 2.4 3.5 1.8 3.6 59 103 (8) 2.9 4.7 1.8 4.4 61 95 (1) 52.2 141.2 44.3 46.6 183.6 40.6 47.4 130.2 49.6 55.3 111.7 46.4 58.1 141.5 47.8 32.1 75.2 4.2 100.9 100.9 34.3 77.5 4.0 106.4 106.4 31.1 77.8 3.5 83.6 83.6 31.3 77.5 3.6 86.6 86.6 32.0 75.5 4.4 106.8 106.8 194.6 194.6 213.4 70.0 494.8 222.5 222.5 243.1 100.0 600.4 289.5 289.5 319.5 199.6 555.8 282.7 282.7 320.9 150.0 663.6 343.9 343.9 383.1 200.0 774.3 40.5 40.5 37.0 15.9 0.9 10.9 10.6 30.5 15.3 35.5 35.5 32.5 13.1 1.3 10.4 10.1 27.3 12.5 27.3 27.3 24.7 14.2 2.5 8.9 8.6 25.0 13.8 27.9 27.9 24.6 11.9 1.9 7.3 7.0 20.2 11.4 22.9 22.9 20.6 10.2 2.5 6.0 5.7 16.3 9.6 CY2008 FY2009 CY2010 CY2011E CY2012E
E-mail: research@angelbroking.com
Website: www.angelbroking.com
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Disclosure of Interest Statement 1. Analyst ownership of the stock 2. Angel and its Group companies ownership of the stock 3. Angel and its Group companies' Directors ownership of the stock 4. Broking relationship with company covered
CRISIL No No No No
Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors
Ratings (Returns):