X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Crisil: A turnaround story - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Jan 4, 2002

    Crisil: A turnaround story

    The early signs of a turnaround in economy is reflected in Crisil's sterling performance. Lead by a strong demand for rating services from corporates and banks, Crisil's revenues in the December quarter jumped by over 60%, YoY. Its earnings before extraordinary items rose over 200% on the back of stiff cost control measures.

    (Rs m) 3QFY01 3QFY02 Change 9mFY01 9mFY02 Change
    Income from operations 99 161 62.4% 316 429 35.7%
    Other Income 4 6 34.8% 11 15 33.6%
    Expenditure 66 73 9.4% 191 227 19.1%
    Operating Profit (EBDIT) 33 88 170.7% 125 202 61.0%
    Operating Profit Margin (%) 32.9% 54.8%   39.6% 47.0%  
    Interest - -   - -  
    Depreciation 10 16 56.1% 39 55 40.1%
    Profit before Tax 26 78 193.6% 97 161 66.3%
    Extraordinary item 31 -   31 -  
    Tax 12 23 93.7% 37 55 47.2%
    Profit after Tax/(Loss) 45 55 21.1% 90 106 17.8%
    Net profit margin (%) 45.6% 34.0%   28.5% 24.7%  
    No. of Shares (eoy) (m) 6.2 6.2   6.2 6.2  
    Diluted Earnings per share* 29.1 35.3   19.3 22.7  
    P/E (at current price)   3.9     6.1  
    *(annualised)            

    Rating business of the company, which accounts for 70% of its total revenues grew by 53% during the third quarter. Crisil rated bond programme of Tamil Nadu Industrial Development Corporation and is working closely with S&P on a number of assignments globally. Among the other new initiatives, the company plans to launch hospital grading services. The company's constant endeavour to introduce new services is likely to enhance its revenue base in the coming quarters.

    Revenue breakup
    (Rs m) 3QFY01 3QFY02 Change 9mFY01 9mFY02 Change
    Rating 74 113 53.0% 236 312 32.3%
    Advisory 17 35 109.7% 55 82 49.2%
    Information services 8 13 50.7% 25 35 37.5%
    Total 99 161 62.4% 316 429 35.7%

    Crisil's advisory business continued to grow at an astounding rate. The business contributed 19% to its total revenues during the first nine months of FY02, from 17% in the comparable previous period. The division was awarded many prestigious mandates in the last nine months. This includes Asian Development Bank funded mandate for preparation of reorganization plan for Gujarat Electricity Board, joint privatisation advisors in the state of Andhra Pradesh and advising Indian Cotton Mills Federation on rationalisation of excise duty structure of the textile industry. Consolidation and restructuring plans in Indian industries are picking up and Crisil with its experience in advising, is likely to reap the maximum benefits.

    Crisil information services however, reported a lower growth compared to its core business. Net earnings from IT services declined by 45% during the first nine months and net margins at 9% are much lower compared to its other businesses. The division launched a real time information service called CrisilMarketWire (CMW), which provides the live coverage of fixed income, money markets and forex markets. CMW has the second largest subscription base in the country.

    Crisil's efforts to control communication and traveling expenses resulted in a sharp rise in its operating margins. The company's operating margins at 47% in the first nine months of FY02 are much better than any financial or software company. Crisil's net profit margins at 25% are also commendable, reflecting a sharp recovery in its advisory and rating businesses.

    At the current market price of Rs 138, Crisil trades at a P/E of 6x and Price/Book value ratio of 1.3x. In the last five years, the company has traded in the average P/E range of 12-40 times. The sharp rebound in the company's performance is likely to bring an upward re-rating in the stock.

     

     

    Equitymaster requests your view! Post a comment on "Crisil: A turnaround story". Click here!

      
     

    More Views on News

    HDFC: Red Flag in Developer Loans (Quarterly Results Update - Detailed)

    Aug 10, 2017

    HDFC starts FY18 on robust loan growth but asset quality slips on increased exposure to developer loans.

    Shriram Trans Fin: FY17 Ends on a Tepid Note due to Regulatory Headwinds (Quarterly Results Update - Detailed)

    Jun 22, 2017

    Demonetisation led slowdown coupled with shift to stringent bad loan norms keep Shriram Transport Finance on a slow wicket.

    Power Finance Corp: Alignment with RBI Norms Knocks Down FY17 Earnings (Quarterly Results Update - Detailed)

    Jun 14, 2017

    Power Finance Corporation earnings hit by RBI mandated higher provision on state government power generation projects where the recovery continues to be 100%.

    IDFC: Ends FY17 on a Healthy Note (Quarterly Results Update - Detailed)

    May 30, 2017

    IDFC regains its tempo in FY17 post the demerger of the banking business.

    HDFC: Conservative Provisioning tempers down FY17 earnings (Quarterly Results Update - Detailed)

    May 9, 2017

    HDFC ends FY17 on a tepid note as it remains conservative on the asset quality front.

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Profitable Investment in the History of the World(Vivek Kaul's Diary)

    Aug 8, 2017

    'Yes, it looks like a bubble. And, yes, it's like buying a lottery ticket. But there's something happening that has never happened before. It's an evolutionary leap in money itself.'

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    CRISIL SHARE PRICE


    Aug 21, 2017 (Close)

    TRACK CRISIL

    CRISIL 8-QTR ANALYSIS

    Detailed Quarterly Results With Charts

    COMPARE CRISIL WITH

    MARKET STATS