or LTV, through its loyalty program, and serving sustainably sourced, healthier fare than quick service restaurant, or QSR, peers. The company has carved out an enduring niche in the U.S. restaurant landscape, with competitive menu prices, extreme convenience, and “food with integrity” allowing the firm to lure away customers from both upscale fast-casual and traditional fast-food competitors.
The burrito chain’s unit development narrative remains compelling, with strong returns on investment driving our high-single-digit unit growth estimates. New format stores (Chipotlanes, digital-only concepts) offer attractive upside, yielding access to heretofore inaccessible or uneconomic trade areas like office buildings, college campuses, and freestanding suburban concepts, leaving us encouraged as Chipotle diligently links appropriate store footprints to various trade areas.
Financial Strength:
Chipotle’s financial strength is sound, with the firm maintaining $1 billion in cash, investments, and cash equivalents at the end of third-quarter 2021, access to a $500 million credit facility, and no long-term debt obligations. The company’s only meaningful fixed charges come in the form of operating leases. Given the company’s growth profile, management has indicated a preference for internally funding expansion (with the intention of maintaining financial flexibility) and has channelled some $1.5 billion into capital expenditure over the last five years, matching $1.5 billion in capital returns through share repurchases over the same time frame.
Bulls Say:
- Accelerated digital adoption during the pandemic supercharged Chipotle’s loyalty program, which should drive increased order frequency and reduce customer churn.
- New format stores (Chipotlanes and digital-only pickup concepts) should position the brand to better compete with quick-service competitors, while opening up new trade areas.
- The success of recent menu innovations (quesadillas, queso blanco, cauliflower rice) validates Chipotle’s stage-gate innovation process and could drive daypart expansion.
Company Profile:
Chipotle Mexican Grill is the largest fast-casual chain restaurant in the United States, with systemwide sales of $7.2 billion over the last twelve months. The Mexican concept is entirely company-owned, with a footprint of nearly 2,900 stores at the end of the third quarter of 2021 heavily indexed to the United States, though the firm maintains a small presence in Canada, the U.K., France, and Germany. Chipotle sells burritos, burrito bowls, tacos, quesadillas, and beverages, with a selling proposition built around competitive prices, high-quality food sourcing, speed of service, and convenience. The company generates its revenue entirely from restaurant sales and delivery fees.
(Source: Morningstar)
General Advice Warning
Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.
Adding to Woodside’s competitive advantages are the long-term 20-year off-take agreements with the who’s who of Asia’s blue chip energy utilities, such as Tokyo Electric, Kansai Electric, Chubu Electric, and Osaka Gas. These help ensure sufficient project financing during development and should bring stability to Woodside’s cash flows once projects are complete.
Woodside also enjoys first-mover advantages. The NWS/JV has invested more than AUD 27 billion since the 1980s, building infrastructure at a fraction of the cost of today’s developments. With substantial growth aspirations, Woodside still has considerable expenditure ahead of it, but the existing infrastructure footprint is regardless a huge head start, from both an expenditure and a regulatory-approval perspective.
Woodside’s development pipeline is deep, enabling it to leverage the tried and trusted project-delivery platform as a template for other world-class gas accumulations off the north-west coast of Australia. Woodside is well suited to the development challenge. With extensive experience, it remains a stand-out energy investment at the right price.
Woodside Banks Higher Third-Quarter LNG Pricing With More to Come.
Australia’s premier LNG company reported a 2% decline in third-quarter 2021 production to 22 million barrels of oil equivalent, or mmboe.LNG production was impacted by flagged maintenance at the North West Shelf’s Trains 2 and 4, and turnaround activities at Pluto LNG.Despite this, and reduced sales volumes due to inventory build, revenue increased 19% to USD 1.53 billion on higher averaged realised pricing. The average realised third-quarter LNG price increased by 40% to around USD 10.00 per mmBtu, considerably higher than the contract price.
In the fourth quarter, Woodside can expect to see even greater benefit from stronger pricing given the one-quarter oil price lag in its LNG contracts, and the even greater spike in spot LNG prices post the third quarter. Woodside sold six LNG spot cargoes in the third quarter, in the vicinity of 10%-15% and is expecting approximately 17% of LNG to be sold at spot in the fourth quarter. In the third quarter, the LNG spot price doubled to more than USD 20 per mmBtu. But the average for October so far is closer to USD 35 per mmBtu.
Financial Strength
Balance sheet strength remains a key appeal of Woodside. The company’s net debt/EBITDA of just 0.8 affords it the luxury of seriously pursuing growth countercyclically. Woodside’s net debt was USD 2.5 billion at June 2021 for modest 16% leverage. And despite expansionary capital expenditure programs, strong cash flows and a healthy balance sheet should regardless support ongoing dividend payments. Including merger with BHP Petroleum, we project net debt to remain modest at less than USD 3.0 billion.This includes a sustained 80% payout ratio.Expansionary expenditure on the Scarborough/Pluto T2 project, and potentially later on the Browse project, could see first expanded production in 2026. We model Woodside’s share of the combined capital cost after BHP Petroleum merger at circa USD 14.0 billion, driving a 13% increase in equity production to circa 250 mmboe, by 2027, and these are long-life additions.
Bulls Say
- Woodside is a beneficiary of continued increase in demand for energy. Behind coal, gas has been the fastest-growing primary energy segment globally. Woodside is favourably located on Asia’s doorstep.
- Woodside’s cash flow base is comparatively diversified, with LNG making it less susceptible to the vagaries of pure oil producers. Gas is a primary component of Asian base-load power generation.
- Gas has around half the carbon intensity of coal, and it stands to gain market share in the generation segment and elsewhere if carbon taxes are instituted, as some predict.
Company Profile
Incorporated in 1954 and named after the small Victorian town of Woodside, Woodside’s early exploration focus moved from Victoria’s Gippsland Basin to Western Australia’s Carnarvon Basin. First LNG production from the North West Shelf came in 1984. BHP Billiton and Shell each had 40% shareholdings before BHP sold out in 1994 and Shell sold down to 34%. In 2010, Shell further decreased its shareholding to 24%. Woodside has the potential to become the most LNG-leveraged company globally.
(Source: Morningstar)
General Advice Warning
Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.
The share sale will value the company at as much as $7.1 billion, giving Nayar and her family a combined net worth of about $3.5 billion if it meets the target. FSN E-Commerce Ventures, the formal entity that operates Nykaa, on Friday set a range of Rs. 1,085 – Rs. 1,125 a share.
Nykaa was promoted by former Kotak investment banking head honcho, Falguni Nayar. The promoter and the family trusts will also participate in the OFS, but will continue to remain majority shareholders post the IPO. Nykaa offers a digital platform to sell beauty and fashion care products as well as apparel and accessories of marquee brands.
Summary of Financial Information (Restated Consolidated)
| Particulars | For the year/ period ended (RS. In millions) | ||||
| 30-Jun-21 | 30-Jun-20 | 30-Mar-21 | 30-Mar-20 | 30-Mar-19 | |
| Total Assets | 16,314.82 | 10,071.84 | 13,019.90 | 11,244.82 | 7,756.57 |
| Total Revenue | 8,217.14 | 2,910.46 | 24,526.37 | 17,778.50 | 11,163.82 |
| Profit After tax | 35.22 | (545.07) | 619.45 | (163.40) | (245.39) |
Nykaa had filed a draft prospectus for its IPO in August this year. The upcoming IPO includes a fresh issue of shares worth Rs 630 crore and an offer for sale (OFS) which will see existing investors offload up to 4.197 crore equity shares, according to the final prospectus.
The online retailer posted a net profit of Rs 62 crore in FY21 compared to a loss of Rs 16.3 crore in FY20. Nykaa’s total income stood at Rs 2,452.6 crore in FY21, a 37.9% growth from Rs 1,777.8 crore in FY20. Its expenses stood at Rs 2,377.2 crore in FY21, a 32.7% increase from Rs 1,790.2 crore in FY20.
Opening date of the IPO is 28th October 2021 and closing date for the IPO is 1st November 2021. Issue type is Book Built Issue IPO. Nykaa has a face value of Rs. 1 per equity share. Nykaa IPO is a main-board IPO of equity shares of the face value of ₹1 aggregating up to ₹5,351.92 Crores. Listing date of IPO is on 11th November 2021.
The main-board IPO of equity share 41,972,660 offered for sale is aggregating up to Rs. 4,721.92 Crores. Pre-issue shares holding for the promoters is 54.22% while Post-issue shares holding for the promoters is 52.56%.
Leading managers of Nykaa IPO are BoFA Securities India Limited, Citigroup Global Market India Private Limited, ICICI Securities Limited, JM Financial Consultants Private Limited, Kotak Mahindra Capital Company Limited, Morgan Stanley India Company Pvt Ltd. Lead manager reports performance tracker and list of IPOs handling
IPO Lot Size
| Application | Lots | Shares | Amount (Cut-off) |
| Minimum | 1 | 12 | Rs. 13,500 |
| Maximum | 14 | 168 | Rs. 1,89,000 |
The Nykaa IPO market lot size is 12 shares. A retail-individual investor can apply for up to 14 lots (168 shares or ₹189,000).
Company Profile
Nykaa is an operator of an e-commerce portal designed to sell cosmetics and beauty products online. The Company sells branded products under the categories of skincare, makeup, luxury products, fragrance, hair care, bath and body products for men and women, enabling customers to choose from a wide range of offers and discounts on all beauty, makeup and wellness products across the brands.
(Source: Financial Express, Mint.com)
General Advice Warning
Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.