Hero Motocorp, Axis Bank, Titan results today - key things to monitor

Preview of Key Nifty companies today: Axis Bank, Titan, Hero Motocorp and L&T.

Preview of Axis Bank, Hero Motocorp, Titan and Larsen: Reuters

Hero Motocorp Preview: ICICI Securities expects revenue growth of 27% YoY largely due to volume growth of 7% YoY and net realisation improvement of 18% due to pass through of the BS-VI price increase. They expect gross margins at 29% (down 313 bps) due to higher raw material costs. EBITDA margin is expected to decline 85 bps YoY.
HDFC Securities highlights Two-wheeler volumes are up 7% YoY, they expect the margin at 12.8% vs. 3.6% margin QoQ, (-175 bps YoY). They expect PAT to come in flat YoY at Rs 9.2 bn, (Rs 613 mn QoQ).

Key monitorables for Q2 FY21:

Channel inventory levels, demand outlook and customer response for new products launched, Market share trends in the premium segment post the launch of the Xtreme 160cc and Festive season expectations.

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Axis Bank Preview: HDFC Securities expects 10% YoY (+2.5% QoQ) loan growth and a marginal improvement in NIMs are expected to drive core earnings growth of 16% YoY (+1.3% QoQ). Drop in non-interest income (muted core fees and lower treasury gains) will result in PPOP de-growth of 5%/3% YoY/QoQ. HDFC securities have factored in a 13% YoY rise in non-tax provisions. However, as provisions are expected to be much lower QoQ, HDFC Securities expect a sharp QoQ rise in PAT (+59%).

Key monitorables for Q2 FY21 will be:

GNPA and below rated loan pool flux, Deposit traction, Comments on restructuring, Outlook on growth, Additional provisions, Subsidiaries’ performance.

Titan Preview: HDFC Securities highlights that Titan’s recovery has been better than expected. They expect net revenue to decline by 2%, Overall EBIT margin to come off by 230 bps YoY at 7.3%, Jewellery revenue grew 8.7% YoY (consolidated) which includes a Rs. 3.9 bn excess gold inventory sale. Jewellery sales have hit near 98% of the base quarter in Q2. HDFC Securities forecasts a 25% decline in volumes. Expect Jewellery EBIT margins to decline 190 bps YoY to 8.5%. Watches and Eyewear segments have recovered to 55 / 58% of Pre-COVID sales respectively.

Key monitorables for Q2 FY21 will be:

See Zee Business Live TV Streaming Below:

Sept sales have come off again; hence commentary on recovery is key and consumer sentiments, Outlook on Watches and Eyewear businesses, Jewellery business EBIT margin, Inventory levels and capital base movement in Jewellery.

L&T Preview: HDFC Securities expect Q2 FY21 net sales at Rs 333.5 bn which is 56.6% higher QoQ and 5.6% below YoY sales number. EBITDA is expected to come in at Rs 33.2 bn which is 105% higher QoQ and 17.4% below YoY number. Margins are expected to come at 10% higher by 233.5 bps QoQ vs 143 bps lower than last year. PAT is expected to come at Rs 14.3 bn which is 1722% more that last quarter and 43.5% below last year.

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