Moneycontrol PRO
Check Credit Score
Check Credit Score
HomeNewsBusinessStocks

Buy Sudarshan Chemical Industries; target of Rs 567: Sharekhan

Sharekhan is bullish on Sudarshan Chemical Industries has recommended buy rating on the stock with a target price of Rs 567 in its research report dated October 26, 2020.

October 28, 2020 / 01:21 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Sharekhan's research repor on Sudarshan Chemical Industries

Sudarshan Chemical Industries Limited (SCIL) reported better-than-expected recovery in revenue at Rs. 429 crore (up 1% y-o-y versus our expectation of 4.9% y-o-y drop), led by better performance in the domestic business. EBITDA margin was in-line at 15.4% (up 75 bps y-o-y). Strong recovery was seen in August-September in the domestic business (up 70% q-o-q) across products especially for coating, plastic, and inks; exports demand remained healthy. Utilisation rate also recovered to 85%-90%. Long-term growth outlook intact, given capex plan of Rs. 585 crore over FY2020-FY2022E to augment capacities. Thus, we expect EBITDA/PAT to register a CAGR of 20%/25% over FY2021E-FY2023E.

Outlook

We recommend Buy on SCIL with a PT of Rs. 567, given its dominant position (fourth largest player globally), double-digit earnings growth outlook, and strong RoE of 22%. The stock is trading at 17.1x FY23E EPS.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Oct 28, 2020 01:21 pm

Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!

Advisory Alert: It has come to our attention that certain individuals are representing themselves as affiliates of Moneycontrol and soliciting funds on the false promise of assured returns on their investments. We wish to reiterate that Moneycontrol does not solicit funds from investors and neither does it promise any assured returns. In case you are approached by anyone making such claims, please write to us at grievanceofficer@nw18.com or call on 02268882347