TATA ELXSI LTD - Quantamental Equity Research Report

	Quantamental Equity Research on TATA ELXSI LTD | Release: 12 Jan 2019 23:02:41 UTC+05:30 | Reporting Currency: INR | Trading Currency: INR | Exchange:NSE/BSE NSE CODE:TATAELXSI and BSE CODE:500408
	Last Close:	INR 961.95
	Fair Value:	INR 751.65
	Est. Price by Mar 19:	INR 1607.45
	Market Capitalization (INR Crs):	5990.68
	Industry:	IT Software Products
	Rating:	STRONG BUY
	Upside:	67%
	Company Profile
	Tata Elxsi provides product design and engineering services to the consumer electronics, communications & transportation industries and systems integration and support services for enterprise customers. It also provides digital content creation for media and entertainment industry.
	Growth Per Share
	Particulars	1-Year	3-Year	5-Year
	Revenue %	12%	102%	156%
	EBIT %	38%	133%	905%
	Earnings %	37%	133%	1044%
	Book Value %	32%	161%	285%
	Stock Total Return %	43%	81%	1028%
	Share holding pattern
	Particulars	%age
	(A) Promoter & Promoter Group	44.57
	(B) FII/FPI	10.76
	(C) DII/Insurance Companies	6.38
	(D) Public holding < 2 lakhs of cap.	28.60
	(E) Others	9.69
	Grand Total	100.00
	Fundamentals (Historical and Estimated)
	Particulars	Mar-10	Mar-11	Mar-12	Mar-13	Mar-14	Mar-15	Mar-16	Mar-17	Mar-18	Mar-19 E	Mar-20 E	Mar-21 E	Mar-22 E	Mar-23 E
	Price	162	131	101	97	278	606	964	769	1099	1607	1873	2114	2310	2448
	Return on Equity	28%	18%	18%	11%	32%	36%	40%	31%	33%	31%	29%	26%	24%	21%
	Price to Earning	21.0	25.8	18.6	28.9	23.1	36.7	38.8	27.4	28.5	34.2	34.2	34.2	34.2	34.2
	EVTI	2.8	2.0	1.3	1.1	2.2	4.4	5.5	3.8	4.8	5.9	5.9	5.9	5.9	5.8
	EVTIFM	21.0	25.8	18.6	28.9	23.1	36.7	38.8	27.4	28.5	34.2	34.2	34.2	34.2	34.2
	Price to Book Value	5.8	4.5	3.3	3.2	7.4	13.3	15.6	8.6	9.3	10.6	9.8	9.0	8.1	7.3
	Debt to Equity	0.2	0.1	0.2	0.3	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
	Dividend Yield	2%	3%	3%	3%	2%	1%	1%	1%	1%	1%	1%	1%	1%	1%
	Cash Flow to Firm	2%	8%	11%	4%	15%	5%	4%	3%	2%	3%	3%	3%	4%	4%
	Detailed Estimates
	Title	Mar-18	Mar-19 E	Mar-20 E	Mar-21 E	Mar-22 E	Mar-23 E
	Sales	1,386.30	1,634.37	1,874.15	2,088.69	2,260.46	2,373.48
	EBITDA	390.06	473.16	542.58	604.69	654.42	687.14
	EBIT	364.71	443.28	516.61	582.96	636.94	675.08
	PBT	363.91	443.28	516.61	582.96	636.94	675.08
	NPAT	240.04	292.61	341.01	384.81	420.44	445.62
	Price to Earning	28.52	34.21	34.21	34.21	34.21	34.21
	Price to Book Value	9.27	10.56	9.79	8.98	8.14	7.31
	Debt to Equity	-	-	-	-	-	-
	Return on Equity	0.33	0.31	0.29	0.26	0.24	0.21
	Enterprise Value to Total Income (EVTI)	4.79	5.88	5.90	5.90	5.87	5.83
	Enterprise Value to Total Income to Firm Margin(EVTIFM)	34.42	40.93	40.47	39.98	39.41	38.76
	Price or Est. Share Prices	1,098.74	1,607.45	1,873.40	2,114.05	2,309.80	2,448.15
	DISCOUNTED CASH FLOW
	Title	Mar-19 E	Mar-20 E	Mar-21 E	Mar-22 E	Mar-23 E
	PBT	443.28	516.61	582.96	636.94	675.08
	Interest	-	-	-	-	-
	Depreciation	29.89	25.97	21.73	17.48	12.06
	Cash Flow Before Tax	473.16	542.58	604.69	654.42	687.14
	Tax Rate	33.99	33.99	33.99	33.99	33.99
	Cash Flow After Tax	312.33	358.16	399.16	431.98	453.58
	Terminal Cash Flow	-				6,462.50
	Total Cash Flow	312.33	358.16	399.16	431.98	6,916.08
Present Value of Cash Flow					4,680.70
Debt					-
Value of Equity					4,680.70
Fair Value Per Share					751.65
Equity					5,991
Debt					0
Beta	Take from Reuters				0.9
Risk Free Rate	Prevailing Yield in India				7%
Market Risk Premium	Assuming 8.82% premium for Equity Investments				7%
Interest Paid					1
Tax Benefit					0
Interest Net of Tax					1
Debt					0
Cost of Debt					0%
Cost of Equity					14%
Debt Weight					0%
Equity Weight					100%
WACC					14%
Cash Flow of Mar-23 E					453.58
Growth					7.0%
Present Value of Terminal Cashflow					6,462.50
Peer Comparision
#	Name	CMP Rs.	Mar Cap Rs.Cr.	B.V. Rs.	Annualized ROE %	ROCE %	Latest EVTI	Latest EVTIFM	CMP / BV	P/E	Debt / Eq	Div Yld %	Growth Rate R %	SGR %	Ann Total Income	Unpledged Prom Hold %	PQEIOI	QoQ Sales %	Qtr Sales Var %	QoQ Profits %	Qtr Profit Var %	Graham's Number Rs.
1	L & T Infotech	1,731.20	30,022	231.15	53.65	39.50	2.92	22.33	7.49	22.51	-	1.23	35.81	65.69	9,712	74.84	99	8.14	33.15	10.79	46.85	634.75
2	Mindtree	832.00	13,663	184.71	38.79	26.55	1.79	20.35	4.50	19.85	0.11	1.32	26.52	36.14	7,231	13.32	89	7.07	31.83	30.40	65.44	417.64
3	L&T Technology	1,633.20	16,980	191.74	50.58	37.86	3.16	29.31	8.52	25.21	0.04	0.97	17.79	17.09	5,284	80.66	125	9.89	40.58	-3.29	55.66	532.27
4	Hexaware Tech.	325.15	9,676	75.20	43.93	34.25	1.85	15.32	4.32	16.91	-	1.23	33.49	34.80	4,944	62.76	66	6.41	21.81	20.03	21.00	181.97
5	Cyient	594.35	6,719	222.02	27.58	22.87	1.18	18.42	2.68	16.05	0.12	2.18	17.62	15.68	4,976	22.10	96	9.90	22.94	53.94	14.00	429.16
6	Tata Elxsi	961.95	5,991	129.54	43.49	56.53	3.46	20.51	7.43	20.73	-	1.14	31.07	33.85	1,617	44.57	87	1.05	17.79	-19.70	5.13	367.79