Buy Century Plyboards says Sharekhan
|Current market value||Rs 505|
|Target value||Rs 413|
According to Sharekhan, one of the main positive aspects of the stock is the strong performance of MDF and particleboard in revenue and operating profit.
In July 2021, the company reported revenue, which reached the level of July 2019, showing strong demand. According to Sharekhan, the company has also influenced the rise in commodity prices to cope with the rise in raw material prices.
“Century Plyboards is expected to revive demand and operating profit margins from Q2FY2022 as it continues to be overwhelmed by the demand generated from the residential segment.
The company has been able to generate strong operating cash flow which is increasing the treasury surplus which will help in capacity expansion. The stock is currently trading at 30 times its FY2023E and FY2024E earnings and 24 times its P / E, which we believe gives it more room to move sideways considering its strong growth outlook and healthy balance sheet. Therefore, we have maintained a buy rating on the stock whose value remains unchanged at Rs. 505, “said Dalali.
Buy the inventory of Bata India, says Sharekhan
|Current market value||Rs 1705|
|Target value||Rs 1905|
Sharekhan Bata has made a buy in the stock of India, though the stock is not as overwhelmed for profit as Century Plyboard.
Revenue from brokers from online platforms increased 15% in Q1FY2022. Sharekhan said the total margin has increased from 307 bps q-o-q to 56.2% due to good mixing.
Bata India posted a stable performance with revenue of Rs 267 crore and operating loss of 60.5% y-o-y reduced to Rs. 34 crore, led by strict cost-saving system and good total margin.
“We have broadly maintained our earnings estimates for FY and FY. After easing the lockdown, the company has started to gain a foothold in its stores. Improving mobility in the coming quarters is good for a quick recovery. Innovating its product portfolio with presence and new relevant variations to drive medium to long term growth.Under new leadership, supported by strong liquidity position, growth is expected to improve with renewal strategies.Currently its FY2023E EPS is 47.2 times and 20.2x FY202323 EPS. Its EV / EBIDTA is trading, “said Dalali.
Investors must not make any trading and investment decisions based on the information discussed in this article. We are not a qualified financial advisor and there is no data investment advice here. It is of an informative nature, taken from Sharekhan’s brokerage report. Please consult a professional advisor. Greenwich Information Technologies Pvt. Ltd., its affiliates, collaborators and authors do not accept responsibility for the loss and / or damage caused by the information in the article.