Jaiprakash Associates down after earnings disappoint
Reuters Market Eye - Shares in Jaiprakash Associates Ltd (JAIA.NS) fell as much as 4.2 percent, a day after the company reported a 64.2 percent fall in Oct-Dec net profit to 1.11 billion rupees.
The company reported a 17 percent rise in cement volumes to 3.7 million metric tonnes for the quarter, Barclays said in a note. However, EBITDA realisation came down 19 percent over the period due to higher fuel and logistics costs, mitigating the advantage of higher cement volumes.
Finance costs rose 15 percent although earnings were supported by high quarterly real-estate sales, it added.
"Near-term stock performance would be driven by JPA's ability to resolve perception around debt service capability," the note said, adding it expects clarity on sale of Gujarat cement plants to ease near-term debt concerns.
(Reporting by Manoj Dharra)
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With the waning of the honeymoon period for the new government and a missed opportunity with Budget 2014, the markets would search for the real level. Any bounceback should be utilized to book out of high-beta stocks and hold cash for lower levels to invest in fundamentally good quality stocks with sound corporate governance, writes Ambareesh Baliga. Full Article