2 GMDCLTD share price target reports by brokerages below. See what is analyst's view on GMDCLTD share price forecast, rating, estimates, valuation and prediction behind the target. You may use these research report forecasts for long-term to medium term for your investment or trades in 2020.
Given the backdrop of depressed consumer sentiment, we believe that industrial activities will be hit in the medium-term leading to moderation in demand for lignite and power. However, in the long run, with the increase in capex from government and private players industrial activities will increase which will boost the demand for electricity and cement contributing in increased demand for lignite. Considering medium term outlook on lignite demand, we have valued the stock at PE 9.5x of FY21 EPS and have arrived at TP of Rs. 74 with potential upside of 13% and recommend “HOLD” on stock. Key risks to valuations are improvement in liquidity situation leading to increased industrial activities and increase in coal prices.
Given the backdrop of strong demand for lignite from power generator (with about 80% lignite application) and cement manufacturer amidst volatile global and domestic market conditions, we expect that the sales and profitability of the company to remain at decently elevated level. We have valued the stock at 1 yr forward PE 6.5x of FY21 EPS and have reached at downwardly revised TP of Rs. 87 with potential upside of 19%. 5 years BSE Energy Index is trading at PE 13x. Risk to valuation could be cheapening of steam coal price in domestic and international markets and steeper contraction in industrial activities.
SOURCE: Data from D'Market via Quandl. Intraday data delayed 15 minutes.
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