S Chand - Anticipation Of A Normal Q4 Sales Season: Prabhudas Lilladher
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Prabhudas Lilladher Report
We cut our earnings per share estimates of S Chand and Company Ltd. by 22% for FY21E as schools for K1-K5 (contributes approximately 30% to sales) have still not opened in most states.
While management sounded confident that an announcement is expected soon given CBSE/ICSE boards have come out with circulars directing schools to start the new academic year on schedule we choose to remain conservative.
Nonetheless, given that the next academic year can just get delayed but may not result in complete loss of business (spill-over of revenues can happen from Q4 FY21 to Q1 FY22 if schools don’t open on time) our earnings cut for FY22E/FY23E is not as steep as FY21E.
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