Quarterly Quotes

February 2021 Compendium of conference calls: Q3FY21 Quarterly Quotes Headwinds galore On a firm footing to Debt ride the trend woes Challenges ahead Policy push Growth levers in place Demand swing Consolidation Debt to be wave f rolled over Rising ad spends Costs in control cus Edelweiss Research Team +91 22 2286 4400 Edelweiss Securities Limited research@edelweissﬁn.com Q3FY21 conference call highlights Dear Investor and Corporate, Quarterly numbers matter; they lend a quantitative as well as qualitative sheen to what has been (Q3FY21 review). But management quotes go far beyond plain-vanilla numbers: they offer deeper insights into what individual companies are doing, how they are thinking and how market participants are perceiving them. That one can benchmark them to industry peers or their previous observations and/or collate them by sector extends their relevance well beyond the results or near-term influences. Management quotes are, hence, far more significant and relevant than mere numbers for the market. Ongoing management commentaries also entail links and threads to a bigger picture as to what’s happening—not only at individual companies, but also in the sector and markets. Besides, they contain a key element of guidance, helping investors identify winning ideas and shed potential losers. So, more than the numbers, it’s the linkage across numbers that’s of bigger import. We try to tie the threads via links to previous quarters (Q2FY21; Q1FY21 was not published in the wake of covid-19). Q3FY21 results were eagerly awaited. Investors were keeping an eye out for corporate India’s resurgence from the chaos caused by covid-19, particularly since Q2FY21 was more about the nature and extent of recovery after the lockdown in Q1FY21. And India Inc. did pass muster. Earnings momentum accelerated in Q3FY21 with our coverage universe posting 33% YoY PAT growth – a multi-quarter high – despite flat top-line growth. More importantly, breadth of profit growth is encouraging with most sectors (especially cyclicals) posting double-digit growth. This is attributable to: i) receding credit costs in financials; ii) cost rationalisation across sectors leading to ~400bps YoY EBITDA margin expansion; iii) market share gains from unlisted players; and iv) pent-up demand. Nifty companies turned in 21% YoY profit growth, and are likely to report a decadal-high 15%-plus EPS growth in FY21E. For those in a hurry, a round-up of key takeaways, quotes and notables that could be reflective of the issues that matter is included. The compendium captures the essence and nuances of what companies are saying bottom-up. We do hope you find this product useful and, as always, welcome feedback to make it better and more relevant for you. Edelweiss Research Team Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL <GO>, Thomson FirstCall, Reuters and Factset Edelweiss Securities Limited Q3FY21 conference call highlights A roundup of key takeaways Best of both worlds again – strong revenue + cost control. But cost pressure is building up. Pricing power would be key hereon. Automobiles Aviation A long runway to a smooth take-off. Slippages – rather pro forma slippages – and restructured pool have been much lower than expected. Actual stress has panned out much Banking lower than projected at the beginning of the pandemic. Demand scenario across segments faring much better; this coupled with strong Consumer Durables consolidation is benefitting leaders. “Rural and smaller towns continue to lead the growth while the metros and big cities are improving progressively.” FMCG —Sanjiv Mehta, Chairman and MD, HUL 2 Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL <GO>, Thomson FirstCall, Reuters and Factset Edelweiss Securities Limited Q3FY21 conference call highlights — "As far as demand is concerned, it's positive. Every month, it's positive," — Ashok Kajaria, Chairman Home Decor and Managing Director, Kajaria Ceramics “Cloud adoption is driving a multi-year technology spending cycle, and this will remain a secular growth driver for TCS for the next three–five years with the transformation IT playing out over multiple horizons.” — Rajesh Gopinathan, CEO, TCS Ordering momentum picking up led by core infra. Stable supply chain and cost initiatives to ensure better Industrials execution and OPM scale-up. “We have restarted allocating capital on margin expansionary growth projects in India within the contours of the targeted financial framework.” — Mr. Kaushik Chatterjee, ED & CFO, Metals & Mining Tata Steel City gas distribution companies record all-time high margins with unabated growth. Oil & Gas Getting into the groove: Long-awaited domestic Pharmaceuticals recovery, US stability and cost normalization visible. Q3FY21 to pave the way for FY22 stability. Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL <GO>, Thomson FirstCall, Reuters and Factset Edelweiss Securities Limited 3 Q3FY21 conference call highlights Abrasives Carborundum Universal......................................................................................... 11 Coromandel International ..................................................................................... 15 Agri Inputs Dhanuka Agritech .................................................................................................. 18 PI Industries ........................................................................................................... 20 Rallis India .............................................................................................................. 22 Sharda Cropchem .................................................................................................. 24 UPL ......................................................................................................................... 25 Auto & auto components Ashok Leyland ........................................................................................................ 28 Bajaj Auto .............................................................................................................. 29 CEAT ....................................................................................................................... 33 Eicher Motors ........................................................................................................ 38 Hero MotoCorp...................................................................................................... 42 Mahindra and Mahindra ........................................................................................ 46 Maruti Suzuki ......................................................................................................... 51 Minda Corporatieon .............................................................................................. 54 Motherson Sumi Systems ...................................................................................... 56 Suprajit Engineering............................................................................................... 58 Tata Motors ........................................................................................................... 61 Banks, financial services and insurance Aavas Financiers .................................................................................................... 67 Axis Bank ................................................................................................................ 68 Bank of Baroda ...................................................................................................... 70 Bajaj Finserv ........................................................................................................... 71 DCB Bank ............................................................................................................... 73 Federal Bank .......................................................................................................... 74 HDFC Bank ............................................................................................................. 76 HDFC Life Insurance Company ............................................................................... 78 ICICI Bank ............................................................................................................... 80 ICICI Lombard General Insurance .......................................................................... 82 ICICI Prudential Life Insurance ............................................................................... 85 IndusInd Bank ........................................................................................................ 87 4 Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL <GO>, Thomson FirstCall, Reuters and Factset Edelweiss Securities Limited Q3FY21 conference call highlights Kotak Mahindra Bank ............................................................................................ 89 LIC Housing Finance ............................................................................................... 91 Mahindra Finance .................................................................................................. 92 Multi Commodity Exchange................................................................................... 94 Muthoot Finance ................................................................................................... 95 Shriram City Union Finance ..................................................................................

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