Honeywell Automation Q1 Review - Weak Execution Impacts Earnings: ICICI Securities
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ICICI Securities Report
Honeywell Automation India Ltd. witnessed 7.2% YoY revenue decline and slight QoQ growth of 1.6% on low base to Rs 6.8 billion in Q1 FY22, lower than our estimate of Rs 8.5 billion.
Honeywell Automation reported an Ebitda margin of 17.1% (down 30 basis points YoY and 210 bps QoQ) despite 130 bps YoY decrease in raw material cost proportion to 47.7%.
Other expenses declined 9% YoY and staff expenses increased 2.4% YoY, impacting the margins.
Factoring-in the revenue slip, we cut our FY21E and FY22E earnings estimates by 4.8% and 4.7% respectively.
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