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3QFY2011 Result Update | Auto Ancillary
January 18, 2011
Exide Industries ACCUMULATE
CMP `138
Performance Highlights Target Price `157
Y/E March (` cr) 3QFY2011 3QFY2010 % chg (yoy) Angel est. % diff. Investment Period 12 Months
Net sales 1,050.2 912.9 15.0 1,161.4 (9.6)
EBITDA 160.1 218.7 (26.8) 244.1 (34.4) Stock Info
EBITDA margin (%) 15.2 24.0 (871)bp 21.0 (579)bp Sector Auto Ancillary
Other income 33.1 1.0 3,148.0 5.0 562.6
Market Cap (` cr) 11,696
Reported PAT 124.4 130.5 (4.6) 150.6 (17.4)
Beta 0.61
Exide Industries (Exide) posted a weak performance in 3QFY2011, missing our 52 Week High / Low 180/102
sales and EBITDA estimates by 9.6% and 34.4%, respectively. Performance was Avg. Daily Volume 282,617
affected by 1) capacity constraints in the automotive batteries segment, forcing the
Face Value (`) 1
company to divert capacities to meet demand from the low-margin OEM segment
BSE Sensex 19,092
2) lack of buoyancy in the industrial batteries segment and 3) EBITDA margin
contraction due to a substantial increase in raw-material costs. We maintain our Nifty 5,724
positive outlook on the battery industry due to changing demographics, which in Reuters Code EXID.BO
turn will support secular consumption growth in Indian markets. However, we Bloomberg Code EXID@IN
have revised our earnings estimates downwards to account for lower-than-
expected 3QFY2011 results. Owing to the recent decline in the stock price, we
recommend Accumulate (from Neutral) with an SOTP Target Price of `157. Shareholding Pattern (%)
Operating performance nosedives; other income saves the day: For 3QFY2011, Promoters 46.0
Exide reported lower-than-expected yoy growth of 15% (down 7% qoq) in net MF / Banks / Indian Fls 26.4
sales to `1,050.2cr. Growth was led by ~13% yoy growth in volumes. EBITDA FII / NRIs / OCBs 16.0
margins fell substantially by 871bp yoy (down 653bp qoq) due to higher
Indian Public / Others 11.6
raw-material costs, thus leading to a 26.8% dip in operating profit. However,
higher other income of `33.1cr restricted the fall in net profit to a certain extent.
Thus, the bottom line reported a 4.6% yoy decline (down 42% qoq) to `124.4cr.
Abs. (%) 3m 1yr 3yr
Outlook and valuation: We estimate Exide to post a 16.9% CAGR in revenue over
Sensex (5.3) 8.2 0.4
FY2010–12E, leading to a 15.7% CAGR in the bottom line. At `138, the stock is
trading at 18.8x FY2011E and 16.3x FY2012E earnings. We recommend Exide Industries (12.1) 15.2 76.4
Accumulate (from Neutral) on Exide with an SOTP Target Price of `157. Owing to
Exide’s defensive appeal and healthy and consistent fundamentals, we value its
core operations at 16.5x (10% premium to its five-year average of 15x) its
FY2012E earnings at `140. We value Exide’s stake in ING Vysya Life Insurance at
`11/share on FY2012E NBAP and have assigned a value of `6/share to its lead
smelters (8x FY12E PAT).
Key financials
Y/E March (` cr) FY2009 FY2010 FY2011E FY2012E
Net sales 3,393 3,794 4,410 5,188
% chg 19.3 11.8 16.2 17.7
Net profit 284 537 623 719
% chg 13.6 88.9 15.9 15.5
EBITDA (%) 16.1 23.5 19.4 20.9
Adj. EPS (`) 3.5 6.3 6.8 8.5
P/E (x) 38.7 21.8 18.8 16.3 Vaishali Jajoo
022-3935 7800 Ext: 6819
P/BV (x) 9.0 5.3 4.4 3.6
vaishali.jajoo@angelbroking.com
RoE (%) 24.9 31.0 23.4 24.0
RoCE (%) 31.7 40.8 29.7 31.7
Yaresh Kothari
EV/Sales (x) 3.3 2.8 2.3 1.9
022-3935 7800 Ext: 6844
EV/EBITDA (x) 20.6 11.7 11.8 9.0 yareshb.kothari@angelbroking.com
Source: Company, Angel Research
Please refer to important disclosures at the end of this report 1
Exide Industries | 3QFY2011 Result Update
Exhibit 1: 3QFY2011 performance
Y/E March (`cr) 3QFY11 3QFY10 % chg 9MFY11 9MFY10 % chg
Net sales 1,050 913 15.0 3,329 2,767 20.3
Consumption of RM 669 517 29.5 1,988 1,560 27.4
(% of sales) 63.7 56.6 59.7 56.4
Staff costs 63.6 55.2 15.3 197.4 168.0 17.5
(% of sales) 6.1 6.0 5.9 6.1
Purchases of TG 13.6 0.6 2,059 49.9 4.6 979.7
(% of sales) 1.3 0.1 1.5 0.2
Other expenses 143.4 121.4 18.0 425.2 359.1 18.4
(% of sales) 13.7 13.3 12.8 13.0
Total expenditure 890 694 28.2 2,661 2,092 27.2
Operating profit 160 219 (26.8) 669 675 (1.0)
OPM (%) 15.2 24.0 20.1 24.4
Interest 1.9 2.9 (35.2) 4.9 7.7 (36.2)
Depreciation 21.2 18.9 12.5 60.8 59.8 1.6
Other income 33.1 1.0 3,148 58.4 3.1 1,814
PBT (excl. extr. items) 170.2 198.0 (14.0) 661.5 610.8 8.3
Extr. Income/(Expense) - - - 46.9 - -
PBT (incl. extr. items) 170.2 198.0 (14.0) 614.6 610.8 0.6
(% of sales) 16.2 21.7 18.5 22.1
Provision for taxation 45.8 67.5 (32.2) 205.8 208.3 (1.2)
(% of PBT) 26.9 34.1 33.5 34.1
Reported PAT 124.4 130.5 (4.6) 502.7 402.6 24.9
PATM 11.8 14.3 15.1 14.5
Adj PAT 124.4 130.5 (4.6) 455.8 402.6 13.2
Adj. PATM 11.8 14.3 13.7 14.5
Equity capital (cr) 85.0 80.0 6.3 85.0 80.0 6.3
EPS (`) 1.5 1.6 (10.3) 5.9 5.0 17.5
Source: Company, Angel Research
Net sales up 15%, lower than expectations: For 3QFY2011, Exide reported 15%
yoy growth in net sales to `1,050cr (`913cr), which was below our expectation of
`1,161cr. Net sales growth was aided by a ~13% yoy jump in volumes.
Sequentially, net sales declined by 7%. Overall, sales growth was restricted as the
company was unable to meet the unprecedented and sustained surge in demand
for auto batteries. Further, due to capacity constraints, the company diverted its
production volumes to the less profitable OEM segment at the cost of the more
profitable replacement segment, which affected its market share in the
replacement segment. This, as guided by management, was to sustain the
company’s long-term relationship with OEMs.
Moreover, lack of buoyancy in the industrial batteries segment affected the
company’s top-line performance. However, management is optimistic about
regaining the lost market share in the replacement market and mitigate
capacity-constraint problems once additional capacities go on stream from
April 2011. Meanwhile, in 2QFY2011, Exide commissioned operations at its new
plant in Ahmednagar for motorcycle batteries.
January 18, 2011 2
Exide Industries | 3QFY2011 Result Update
Exhibit 2: Net sales up 15%; capacity constraints restrict volume growth
(` cr) Net sales (LHS) yoy growth (RHS) (%)
1,400 35
27.5 30
1,200
28.9
25
1,000
20
800 15.0
15.9 18.6
15
600
10
400 5.6 5
200 (0.3) 0
0 (5)
1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11
Source: Company, Angel Research
EBITDA margins decline substantially, down 871bp: During 3QFY2011, Exide
witnessed a significant 871bp yoy decline in EBITDA margins to 15.2%, due to a
717bp yoy increase in raw-material costs, which accounted for around 63.7% of
sales (56.6% in 3QFY2010). On a sequential basis, margins contracted by 653bp,
leading to a 34.8% qoq decline in operating profit. Raw-material costs were also
affected during the quarter, largely because of the ~4.5% yoy and ~17% qoq
increase in prices of lead, the company’s key input component. Margins also
declined due to the product mix, which was inclined more towards OEMs during
the quarter. Moreover, subdued performance in the industrial batteries segment
affected the company’s operating margins, as industrial batteries command higher
margins. Additionally, due to its vulnerable position in the replacement segment,
the company was cautious in passing on the lead price increase, further
pressurising margins.
Exhibit 3: Average lead prices up 4.5% yoy Exhibit 4: High raw-material cost impacts margins
(US $/tonne) Lead inventory (RHS) Lead prices (LHS) (tonne) (%) EBITDA margin Raw material cost/sales
5,000 250,000 70 65.1
58.2 59.9 59.6 59.3
54.9 56.7
60
4,000 200,000
50
3,000 150,000 40
26.0 24.0
30 23.2 21.2 22.8 21.8
2,000 100,000
20 15.2
1,000 50,000
10
0 0 0
Dec-01 Dec-04 Dec-07 Dec-10 1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11
Source: Company, Bloomberg, Angel Research Source: Company, Angel Research
Net profit declines 4.6%: Exide reported a 4.6% yoy decline (down 42% qoq) in net
profit to `124.4cr (`130.5cr) during the quarter, as against our estimate of
`150.6cr. Net profit margin declined by 279bp yoy to 11.8% in 3QFY2011, as
against 14.3% in 3QFY2010. However, higher other income at `33.1cr (inclusive
of net exchange gains of `11cr), up substantially from `1cr in 3QFY2010,
restricted the fall in net profit to a large extent.
January 18, 2011 3
Exide Industries | 3QFY2011 Result Update
Exhibit 5: Net profit declines 4.6% yoy
(`cr) Net profit (LHS) Net profit margin (RHS) (%)
180 18
15.7
160 14.3 14.4 14.7 16
13.5 13.1
140 14
11.8
120 12
100 10
80 8
60 6
40 4
20 2
0 0
1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11
Source: Company, Angel Research
January 18, 2011 4
Exide Industries | 3QFY2011 Result Update
Investment arguments
Robust demand scenario for auto and industrial batteries: The auto and
industrial battery segments have been witnessing strong growth post the
economic downturn, driven by robust demand-pull on account of higher auto
and industrial production and increased consumer spending. We expect the
auto and industrial battery segments to continue to grow, generating robust
revenue CAGRs of ~16.9% and ~15.8%, respectively, over FY2010–12E.
Hence, we forecast Exide to register strong revenue CAGRs of 17.2% and
17.7% in the auto and industrial battery segments, respectively.
Market leader with wider reach and strong pricing power: Exide is a dominant
player in the auto battery (OEM and replacement) and industrial battery
segments with market share of 60–65% and 40–45%, respectively. Exide has
leveraged upon its brand equity, better quality proposition and wider reach to
consolidate its position in the market, which gives the company a superior
pricing power compared to peers. Over the years, Exide has been able to
improve its realisation across the auto and industrial battery segments, which
has more than offset the movements in input prices. We expect Exide to
continue to leverage upon its market leadership position and pricing power,
which would enhance the company’s ability to pass on cost increases in the
future as well. Hence, we expect average realisation to grow at a ~3.3%
CAGR over FY2010–12E.
Captive sourcing reduces impact of lead price volatility: Exide acquired
Tandon Metals (FY2008) and Leadage Alloys (51% in FY2009 and 49% in
2QFY2011) to recycle used lead and lessen the vulnerability of rising lead
prices. This reduced the company's dependence on imported lead in FY2010
to ~32% (~36% in FY2009). Total lead supplied by the captive smelter
increased to ~50% in FY2010 from ~35% in FY2009. Exide has benefitted
from its captive sourcing strategy, as lead sourcing from captive smelters is
10–15% cheaper compared to market rates.
Going forward, Exide plans to increase sourcing from its smelters to ~55% in
FY2011E and ~70% by FY2012E. Hence, the company will be expanding its
lead smelter capacity to 100,000tpa by March 2011. Our sensitivity analysis
suggests that for every 10% increase in sourcing from captive smelters, the
company’s EBITDA margins expand by ~50bp (assuming stable lead prices).
Capacity expansion to increase volume growth: Exide has been operating at
~90% utilisation levels over the past five years. The company plans to increase
its battery capacity with an investment of `400cr in FY2011E to cater to the
growing demand. The company also plans to increase its two-wheeler and
four-wheeler battery capacity by 60% and 28%, respectively, by FY2011. As a
result of increased capacity, we believe Exide is well placed to meet the rising
auto battery demand. We estimate the overall utilisation level to remain at
78–80% in FY2012E. Further, we expect Exide to post volume CAGRs of
13.5% and 14.4% in the auto and industrial battery segments, respectively,
over FY2010–12E.
January 18, 2011 5
Exide Industries | 3QFY2011 Result Update
Outlook and valuation
We estimate Exide to post a 16.9% CAGR in revenue over FY2010–12E, leading to
a healthy 15.7% CAGR in the bottom line. Moreover, the company’s strong brand
image has been creating value, while continuously improving its RoCE, due to
better asset turnover on incremental capacities. We believe Exide will continue to
achieve higher return ratios and better margins on the back of pricing power and
assuming increased in-house lead supply, which in turn would reduce the impact
of volatility in lead prices going forward. Further, a strong balance sheet and lower
debt-to-equity ratio will aid the company in sustaining strong cash flows.
We have revised our EPS estimates downwards to `6.8 (`7.4 earlier) and to `8.5
(`9.1 earlier) for FY2011E and FY2012E, respectively, owing to lower-than-
expected performance during 3QFY2011. At `138, the stock is trading at 18.8x
FY2011E and 16.3x FY2012E earnings. Owing to the recent decline in the stock
price, we recommend Accumulate (from Neutral) with an SOTP Target Price of
`157. Owing to the company’s defensive appeal and healthy and consistent
fundamentals, we value its core operations at 16.5x (10% premium to its five-year
average of 15x) its FY2012E earnings at `140. We value Exide’s stake in ING
Vysya Life Insurance at `11/share on FY2012E NBAP and have assigned a value
of `6/share to its lead smelters (8x FY2012E PAT).
Exhibit 6: Change in estimates
Y/E March Earlier estimates Revised estimates % chg
FY2011E FY2012E FY2011E FY2012E FY2011E FY2012E
Net sales (` cr) 4,768 5,697 4,410 5,188 (7.5) (8.9)
OPM (%) 21.9 21.6 19.4 20.9 (249)bp (71)bp
EPS (`) 7.4 9.1 6.8 8.5 (8.5) (7.0)
Source: Company, Angel Research
Exhibit 7: One-year forward P/E band Exhibit 8: One-year forward P/E chart
(`) Share price (`) 6x 10x 14x 18x (x) One-yr forward P/E Five-yr average P/E
200 Long term average P/E
30
180
160 25
140
20
120
100 15
80
60 10
40 5
20
0 0
Jul-03
Jul-06
Jul-09
Jan-02
Jan-05
Jan-08
Jan-11
Jan-02
Jan-05
Jan-08
Jan-11
Apr-01
Apr-04
Apr-07
Apr-10
Apr-01
Apr-04
Apr-07
Apr-10
Oct-02
Oct-05
Oct-08
Oct-02
Oct-05
Oct-08
Jul-03
Jul-06
Jul-09
Source: Company, Bloomberg, Angel Research Source: Company, Bloomberg, Angel Research
January 18, 2011 6
Exide Industries | 3QFY2011 Result Update
Exhibit 9: Key assumptions
Y/E March FY07 FY08 FY09 FY10 FY11E FY12E
Storage batteries (‘000 units) 17,686 17,996 19,109 21,899 24,978 28,275
yoy chg (%) 22.1 1.8 6.2 14.6 14.1 13.2
Realisation per battery (`) 1,347 1,978 2,206 2,069 2,135 2,207
yoy chg (%) 10.8 46.8 11.5 (6.2) 3.2 3.3
Million Ampere Hours (mnAH) 2,721 3,124 3,475 3,949 4,500 5,097
yoy chg (%) - 14.8 11.2 13.6 13.9 13.3
Total gross revenue (` cr) 2,383 3,606 4,233 4,542 5,345 6,251
Automotive 1,668 2,561 2,905 3,108 3,679 4,271
yoy chg (%) - 53.6 13.4 7.0 18.4 16.1
Industrial 715 1,019 1,269 1,397 1,625 1,934
yoy chg (%) - 42.6 24.5 10.1 16.3 19.0
Other 0.1 25.5 59.8 36.7 40.8 45.4
Source: Company, Angel Research
Exhibit 10: Angel v/s consensus forecast
Angel estimates Consensus Variation (%)
FY11E FY12E FY11E FY12E FY11E FY12E
Net sales (` cr) 4,410 5,188 4,833 5,787 (8.8) (10.3)
EPS (`) 6.8 8.5 7.8 9.4 (12.8) (10.0)
Source: Bloomberg, Angel Research
Exhibit 11: Auto Ancillary - Recommendation summary
CMP Tgt. price Upside P/E (x) EV/EBITDA (x) RoE (%) FY10-12E EPS
Company Reco.
(`) (`) (%) FY11E FY12E FY11E FY12E FY11E FY12E CAGR (%)
Amara Raja Batteries Buy 171 251 46.9 10.3 7.8 5.9 4.6 23.3 24.6 5.7
^
Automotive Axle Buy 395 525 33.0 12.1 11.3 6.2 5.5 22.1 19.8 9.6
Bharat Forge*& Buy 349 404 15.8 28.4 17.3 13.9 10.1 16.6 21.7 -
#
Bosch India Accumulate 6,325 6,766 7.0 23.1 20.1 14.2 11.9 23.7 22.7 37.0
Exide Industries Accumulate 138 157 14.1 18.8 16.3 11.8 9.0 23.4 24.0 15.7
FAG Bearings# Buy 831 1,035 24.5 11.7 10.8 6.0 5.2 22.9 20.4 39.5
Motherson Sumi* Accumulate 172 195 13.3 19.7 14.8 8.3 7.1 27.3 32.2 36.7
Subros Buy 40 57 44.1 9.5 7.0 4.3 3.7 11.3 13.9 10.0
# ^ &
Source: Company, Angel Research; Note: * Consolidated results; December year end; September year end; FY2011E and FY2012E EPS adjusted for
FCCB interest after tax
January 18, 2011 7
Exide Industries | 3QFY2011 Result Update
Profit & loss statement
Y/E March (` cr) FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Gross sales 2,383 3,606 4,233 4,542 5,345 6,251
Less: Excise Duty 300 449 464 328 428 500
Less: Sales Tax, VAT, Octroi 213 312 376 419 508 563
Net Sales 1,870 2,845 3,393 3,794 4,410 5,188
Total operating income 1,870 2,845 3,393 3,794 4,410 5,188
% chg 35.6 52.1 19.3 11.8 16.2 17.7
Total Expenditure 1,565 2,373 2,845 2,902 3,554 4,105
Net Raw Materials 1,141 1,874 2,248 2,181 2,793 3,289
Other Mfg costs 143 163 188 219 228 242
Personnel 120 146 165 219 241 253
Other 161 191 243 284 292 321
EBITDA 305 472 548 892 856 1,084
% chg 38.8 54.5 16.1 62.8 (4.1) 26.6
(% of Net Sales) 16.3 16.6 16.1 23.5 19.4 20.9
Depreciation & Amortisation 54 64 68 81 82 93
EBIT 251 408 480 811 774 991
% chg 52.0 62.2 17.8 69.0 (4.6) 28.0
(% of Net Sales) 13.4 14.3 14.1 21.4 17.6 19.1
Interest & other Charges 31 41 52 14 6 7
Other Income 15 7 7 12 109 76
(% of PBT) 6.3 2.0 1.6 1.5 13.1 7.1
Recurring PBT 235 374 435 810 877 1,060
% chg 55.1 59.2 16.3 86.2 8.2 20.9
Extraordinary Items 3 2 1 - 47 -
PBT (reported) 232 372 434 811 830 1,060
Tax 80 124 151 273 254 341
(% of PBT) 34.4 33.3 34.7 33.7 30.6 32.2
PAT (reported) 155 250 284 537 623 719
Adj. PAT 152 248 283 537 576 719
% chg 50.9 63.0 14.2 89.7 7.1 24.9
(% of Net Sales) 8.1 8.7 8.3 14.2 13.1 13.9
Basic EPS (`) 2.1 3.1 3.6 6.3 7.3 8.5
Adj. EPS (`) 2.0 3.1 3.5 6.3 6.8 8.5
% chg 50.9 52.9 14.2 78.5 7.1 24.9
January 18, 2011 8
Exide Industries | 3QFY2011 Result Update
Balance sheet
Y/E March (` cr) FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
SOURCES OF FUNDS
Equity Share Capital 75 80 80 85 85 85
Reserves & Surplus 595 946 1,170 2,135 2,611 3,206
Shareholders’ Funds 670 1,026 1,250 2,220 2,696 3,291
Total Loans 325 350 317 90 90 90
Deferred Tax Liability 45 48 41 59 50 42
Total Liabilities 1,040 1,424 1,609 2,369 2,836 3,423
APPLICATION OF FUNDS
Gross Block 946 1,097 1,257 1,336 1,575 1,789
Less: Acc. Depreciation 480 542 589 660 742 835
Net Block 466 555 668 677 833 954
Capital Work-in-Progress 31 47 17 38 16 18
Investments 378 518 668 1,335 1,560 1,883
Current Assets 575 876 742 912 1,142 1,395
Cash 1 2 34 3 155 179
Loans & Advances 29 45 38 48 44 57
Other 545 830 669 861 943 1,159
Current liabilities 410 572 487 593 715 827
Net Current Assets 165 304 255 319 427 568
Total Assets 1,040 1,424 1,609 2,369 2,836 3,423
Cash flow statement
Y/E March (` cr) FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Profit before tax 232 372 434 811 830 1,060
Depreciation 54 64 68 81 82 93
Change in Working Capital 25 124 (55) 62 (28) 109
Less: Other income 42 243 (202) 159 (67) 249
Direct taxes paid 80 124 151 273 254 341
Cash Flow from Operations 189 194 498 521 696 672
(Inc.)/Dec. in Fixed Assets (88) (167) (130) (100) (216) (216)
(Inc.)/Dec. in Investments (99) (140) (150) (667) (224) (323)
(Inc.)/Dec. in loans and advances (0) (13) 6 3 (10) (13)
Other income (7) 14 (41) (11) - -
Cash Flow from Investing (194) (307) (315) (775) (451) (552)
Issue of Equity - 149 - 530 - -
Inc./(Dec.) in loans 35 25 (33) (227) - -
Dividend Paid (Incl. Tax) 26 31 37 56 95 99
Others (71) (91) (156) (135) (188) (196)
Cash Flow from Financing (10) 113 (151) 224 (93) (96)
Inc./(Dec.) in Cash (16) 0 32 (31) 153 24
Opening Cash balances 17 1 2 34 3 155
Closing Cash balances 1 2 34 3 155 179
January 18, 2011 9
Exide Industries | 3QFY2011 Result Update
Key ratios
Y/E March FY2007 FY2008 FY2009 FY2010 FY2011E FY2012E
Valuation ratio (x)
P/E (on FDEPS) 66.5 44.0 38.7 21.8 18.8 16.3
P/CEPS 49.3 35.0 31.2 18.9 17.8 14.4
P/BV 16.4 11.1 9.0 5.3 4.4 3.6
Dividend yield (%) 0.3 0.3 0.4 0.7 0.7 0.9
EV/Sales 6.2 4.1 3.3 2.8 2.3 1.9
EV/EBITDA 38.1 24.4 20.6 11.7 11.8 9.0
EV / Total Assets 11.2 8.1 7.0 4.4 3.6 2.8
Per share data (`)
EPS (Basic) 2.1 3.1 3.6 6.3 7.3 8.5
EPS (fully diluted) 2.0 3.1 3.5 6.3 6.8 8.5
Cash EPS 2.8 3.9 4.4 7.3 7.7 9.6
DPS 0.4 0.4 0.6 1.0 1.0 1.3
Book Value 8.4 12.4 15.2 25.8 31.4 38.4
DuPont analysis
EBIT margin 13.4 14.3 14.1 21.4 17.6 19.1
Tax retention ratio 0.7 0.7 0.7 0.7 0.7 0.7
Asset turnover (x) 3.2 3.8 3.9 4.0 4.2 4.3
ROIC (Post-tax) 28.3 36.6 36.0 57.4 51.4 55.5
Cost of Debt (Post Tax) 6.6 8.1 10.1 4.4 4.9 4.9
Leverage (x) - - - - - -
Operating ROE 28.3 36.6 36.0 57.4 51.4 55.5
Returns (%)
ROCE (Pre-tax) 26.0 33.1 31.7 40.8 29.7 31.7
Angel ROIC (Pre-tax) 40.7 47.0 54.9 81.1 71.0 74.4
ROE 24.9 29.2 24.9 31.0 23.4 24.0
Turnover ratios (x)
Asset Turnover (Gross Block) 2.0 2.8 2.9 2.9 3.0 3.1
Inventory / Sales (days) 62 62 54 50 51 50
Receivables (days) 29 26 26 23 26 26
Payables (days) 53 51 46 42 43 40
WC cycle (ex-cash) (days) 30 30 28 26 24 23
Solvency ratios (x)
Net debt to equity (0.1) (0.2) (0.3) (0.6) (0.6) (0.6)
Net debt to EBITDA (0.2) (0.4) (0.7) (1.4) (1.9) (1.8)
Interest Coverage (EBIT / Int.) 8.1 10.0 9.3 60.1 123.1 152.1
January 18, 2011 10
Exide Industries | 3QFY2011 Result Update
Research Team Tel: 022 - 3935 7800 E-mail: research@angelbroking.com Website: www.angelbroking.com
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document are those of the analyst, and the company may or may not subscribe to all the views expressed within.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.
Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify,
nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While
Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory,
compliance, or other reasons that prevent us from doing so.
This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,
redistributed or passed on, directly or indirectly.
Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or
other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in
the past.
Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in
connection with the use of this information.
Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please
refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and
its affiliates may have investment positions in the stocks recommended in this report.
Disclosure of Interest Statement Exide Industries
1. Analyst ownership of the stock Yes
2. Angel and its Group companies ownership of the stock No
3. Angel and its Group companies' Directors ownership of the stock No
4. Broking relationship with company covered No
Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors
Ratings (Returns): Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
Reduce (-5% to 15%) Sell (< -15%)
January 18, 2011 11
