A gilt fund juggles around with maturities to maximise returns, but, effectively, a lot of the return depends on capital appreciation in the underlying bonds. They have to do this as most of the gilts that funds hold may not have attractive coupon rates. Though gilt funds too have accrual income through coupon payments on the securities, other debt fund categories score better on this count as they invest in higher-yield corporate and bank debt papers. … [Read more...] about Double-digit returns in gilt funds: Should you rush to invest in them?
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Supreme Industries Q4FY20 revenue (down ~8% YoY) was hit by packaging and industrial segments (together contributes ~30% of topline) with revenue de-growth of ~22% in each segment during Q4FY20, much lower than our estimate of 7% YoY. However, core business performance i.e. piping segment remained satisfactory with almost flat revenue YoY (up 17% QoQ) despite lockdown in March 2020. On the profitability front, EBITDA margin moved up ~590 bps YoY (303 bps QoQ) due to a sharp increase in gross margin (up ~1000 bps YoY, 545 bps QoQ) reflecting benefit of benign raw material prices and change in product mix. We believe the FY21E performance is likely to be impacted by less spending in construction and infra related works owing to Covid-19 pandemic. However, a slow recovery in demand of core business would drive the performance from FY22E onwards. We cut our revenue and earnings estimate by ~15%, ~29% for FY21E and ~20%, 16% for FY22E, respectively. Considering a slow recovery in demand of … [Read more...] about Hold Supreme Industries; target of Rs 1040: ICICI Direct