Author: Sambit Mohanty

U.S. Economic Summary

Posted on by Sambit Mohanty

Q4 GDP revised to 4.1% from 4%:
The U.S. economy grew 4.1% in Q4, according to the final estimate, 10bps below consensus. For 2020, the economy
was down 3.5%, the worst performance since 1946. The expansion for the quarter reflected positive contributions from
exports, nonresidential fixed investment, PCE, residential fixed investment, and private inventory investment.

Vinati Organics

Posted on by Sambit Mohanty

Key points from this report:

 

  • Buy Vinati Organics shares as they gained 7% today and broke out of an 18-week cup-with-handle base on heavy volume.
  • The company announced the amalgamation of its subsidiary Veeral Additives, a manufacturer of antioxidants (AO), thus foraying into a new specialty chemical revenue stream through forward integration for butylphenol.
  • The AO plant will be ramped up to full capacity of 25K TPA by June 2022, which will exceed domestic demand. AO has a revenue potential of ~INR 3B, which is ~30% of FY20 revenue. Revenue growth is expected to accelerate in FY22 and FY23 aided by the impending launch of high-growth revenue streams.
  • Q3 FY21 results were weak, with revenue declining 3% y/y and EBITDA margin declining 3ppts, mainly due to higher employee expenditure.

U.S. Economic Summary

Posted on by Sambit Mohanty

Q3 GDP revised to 33.4% from 33.1%:
The U.S. economy grew 33.4% in Q3, according to the final estimate, 30bps better than consensus. This is the biggest
expansion in GDP ever, as the economy gradually recovered from the record drop of 31.4% in Q2. The expansion
reflected positive contributions from PCE, private inventory investment, exports, nonresidential fixed investment, and
residential fixed investment. The Fed sees the U.S. economy shrinking 6.5% in 2020.