Gitanjali Gems
Gitanjali Gems Ltd.
BUY CMP: Rs.118.00 Date: March 02, 2010 Key Ratios: Particulars OPM(%) NPM(%) ROE(%) ROCE(%) P/BV(x) P/E(x) EV/EBDITA(x) Debt-Equity(x) Key Data: Sector Face Value 52 wk. High/Low Volume (2 wk. Avg.) BSE Code Target Price: Rs.136.00 Market Cap.: Rs.9943.86mn.
FY09 5.70 3.05 7.58 7.71 0.49 6.67 3.46 0.62
FY10E 6.07 2.73 8.43 10.65 0.44 5.31 2.37 0.63
FY11E 6.08 2.78 8.99 11.15 0.40 4.53 2.07 0.63
SYNOPSIS
Gitanjali Gems is one of the largest integrated diamond and jewellery manufacturers and retailers in India. The company became first to produce the world’s smallest heart shaped diamond (0.03 carat) and developing some 25 patented facet patterns. Gitanjali Group, the jewellery maker and exporter, is planning to invest Rs 400 crore in next 18 months for expanding its retail business in India and overseas markets. Gitanjali Gems’ wholly owned subsidiary, Gitanjali Lifestyle has decided to set up a joint venture company in India in collaboration with Damas LLC, Dubai. The company, which currently has 150 stores across India, is planning to increase it by three fold and double the 140 outlets it owns in US, China and Middle-East. The company’s Net Sales & PAT are expected to grow at a CAGR of 18% & 8% over FY08 to FY11E.
Gems & Jewellery Rs.10.00 Rs.149.00/Rs.32.50 117000 532715
V.S.R. Sastry Vice President Equity Research Desk 91-22-25276077 vsrsastry@firstcallindiaequity.com
Share Holding Pattern:
Dr. V.V.L.N. Sastry Ph.D. Chief Research Officer drsastry@firstcallindia.com
1
Table of Content
Content 1. Investment Highlights 2. Company Profile 3. Peer Group Comparison 4. Key Concerns 5. Financials 6. Charts & Graph 7. Outlook and Conclusion 8. Industry Overview Page No. 03 08 10 10 11 13 15 16
2
Investment Highlights
• Q3 FY10 Results Update Gitanjali Gems reported a rise of 39.41% in consolidated net profit for the quarter ended Dec 2009. During the quarter, the profit of the company went up to Rs 406.42
BUY CMP: Rs.118.00 Date: March 02, 2010 Key Ratios: Particulars OPM(%) NPM(%) ROE(%) ROCE(%) P/BV(x) P/E(x) EV/EBDITA(x) Debt-Equity(x) Key Data: Sector Face Value 52 wk. High/Low Volume (2 wk. Avg.) BSE Code Target Price: Rs.136.00 Market Cap.: Rs.9943.86mn.
FY09 5.70 3.05 7.58 7.71 0.49 6.67 3.46 0.62
FY10E 6.07 2.73 8.43 10.65 0.44 5.31 2.37 0.63
FY11E 6.08 2.78 8.99 11.15 0.40 4.53 2.07 0.63
SYNOPSIS
Gitanjali Gems is one of the largest integrated diamond and jewellery manufacturers and retailers in India. The company became first to produce the world’s smallest heart shaped diamond (0.03 carat) and developing some 25 patented facet patterns. Gitanjali Group, the jewellery maker and exporter, is planning to invest Rs 400 crore in next 18 months for expanding its retail business in India and overseas markets. Gitanjali Gems’ wholly owned subsidiary, Gitanjali Lifestyle has decided to set up a joint venture company in India in collaboration with Damas LLC, Dubai. The company, which currently has 150 stores across India, is planning to increase it by three fold and double the 140 outlets it owns in US, China and Middle-East. The company’s Net Sales & PAT are expected to grow at a CAGR of 18% & 8% over FY08 to FY11E.
Gems & Jewellery Rs.10.00 Rs.149.00/Rs.32.50 117000 532715
V.S.R. Sastry Vice President Equity Research Desk 91-22-25276077 vsrsastry@firstcallindiaequity.com
Share Holding Pattern:
Dr. V.V.L.N. Sastry Ph.D. Chief Research Officer drsastry@firstcallindia.com
1
Table of Content
Content 1. Investment Highlights 2. Company Profile 3. Peer Group Comparison 4. Key Concerns 5. Financials 6. Charts & Graph 7. Outlook and Conclusion 8. Industry Overview Page No. 03 08 10 10 11 13 15 16
2
Investment Highlights
• Q3 FY10 Results Update Gitanjali Gems reported a rise of 39.41% in consolidated net profit for the quarter ended Dec 2009. During the quarter, the profit of the company went up to Rs 406.42