Castrol India reported its first quarter results yesterday and investors have cheered it by taking stock price up by almost 6% in yesterday’s trading. Here are the few key points that we have taken from the results.

  • Total income from operations had jumped up by 7% compare to last year same quarter.
  • EBIDTA margins for the quarter comes to 29.19% compare to last year same quarter was 22.63% and last quarter it was 26.07%. This improvement is because of lower cost of materials and control over advertisement and other expenses.
  • The net profits after tax increased by 17.52% compare to last year, reporting its EPS Rs 3.49 for this quarter.
  • The overall strong performance in the first quarter will result in earnings upgrade by most of the analysts. Currently the consensus earnings for the December 2016 stand at Rs 13.72 per share. We think this will gradually be increased to Rs 14.50 -14.60 range.

This overall good performance will result in upgrade to its intrinsic value. Now we have come to conclusion that its 2017 expected intrinsic value will be in range of Rs 410 – 420.

Aziz Dodhiya is the chief investment officer for the Valueoperations funds which operates in the Indian market as an FPI (Foreign Portfolio Investor). We do not offer any personal advice to buy or sell any stocks and the views that are shared by Aziz might not incline to your personal investment strategy and this is the reason we advise you to take professional advice before going ahead with our views.