Bulls Hit A Six

Earnings Roundup 

Devyani International (+8%) hit a new all-time high on delicious Q1 results. Aggressive store expansion and healthy all-round demand drove the outperformance. 💸

Devyani added a record 70 new retail outlets surpassing the 1,000 store mark for the first time ever. KFC posted the highest average daily sales per store (ADS), surpassing pre-pandemic levels! Investors were also impressed by the steady operating margins despite increased cost pressure in Q1. Here’s its report card: 📊

• Revenue: Rs 705 cr; +2x YoY 
• EBITDA: Rs 165 cr; +3x YoY 
• EBITDA Margin: 23.4% vs 16.1% YoY 
• Net Profit: Rs 75 cr vs net loss of Rs 33 cr YoY 

Ravi Jaipuria, Chairman at Devyani International Limited said: 

On the economic front, we are seeing early signs of recovery in consumer sentiment. We ended Q1 FY 22-23 with growth across all our brands. As a result, we witnessed good recovery in overall sales in the quarter with strong traction in the dine-in channel. 

Going forward, Devyani International aims to add another 1,000 stores (+2x) in the next 4-5 years. PS – It took them +25 years to open the first 1,000 stores! They are also confident of maintaining +20% operating margins which is a huge positive. ✅

Devyani International is +9% YTD.

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Bank-ing for Gains

Banking stocks are at the top of every market expert’s buying list. The Nifty Bank Index has rallied +13% in the past month outpacing the ~10% rise in Nifty50 Index. 📈

What’s the deal bro? Banks are the backbone of any economy. Banks lend money to businesses which boosts production, generates employment, and in turn drives economic growth. So, naturally when the economy is in a good shape banks tend to outperform and vice versa. 💰

Credit growth has witnessed a significant rebound in recent months, according to the latest quarterly results of top banks. Recent GST data (2nd highest monthly collection) and manufacturing data (8-month high) have sparked hopes of robust growth despite steep inflation and geopolitical tensions. Bad loan (NPA) pressure has eased considerably from the Covid peak, another indication of solid economic health. 💪 

SBI and ICICI Bank are amongst the top picks. Higher loan growth, improving operating profits, and a strong provision buffer may drive ROE expansion for ICICI Bank, said experts. Similarly, SBI’s improving asset quality, unparalleled distribution network, and healthy business outlook are key positives. FYI – Axis Securities sees up to 25% in the stock from current levels. 🤑

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Earnings Highlights 

• Indus Towers: Revenue: Rs 6,990 cr; (+2% YoY) | Net Profit: Rs 477 cr; (-66% YoY)
• Siemens: Revenue: Rs 4,258 cr; (+50% YoY) | Net Profit: Rs 301 cr; (+1.1X YoY)
• Voltas: Revenue: Rs 2,795 cr; (+50% YoY) | Net Profit: Rs 109 cr; (-11% YoY)
• Navneet Education: Revenue: Rs 698 cr; (+1.1X YoY) | Net Profit: Rs 139 cr; (+3.3X YoY)
• Godrej Consumer Products: Revenue: Rs 3,152 cr; (+8% YoY) | Net Profit: Rs 345 cr; (-17% YoY)

Calendar 

We’re in the thick of the earnings season. Here’s all the companies that will announce their Q1 results tomorrow: