Reduce Thermax, target price Rs 2178: Geojit

Geojit Financial Services has reduce call on Thermax with a target price of Rs 2178. The current market price of Thermax Ltd. is Rs 2398.55. Time period given by analyst is one year when Thermax Ltd. price can reach defined target.

Thermax Ltd., incorporated in the year 1980, is a Mid Cap company (having a market cap of Rs 28662.45 Crore) operating in Engineering sector.

Thermax Ltd. key Products/Revenue Segments include Sale of services, Export Incentives, Scrap, Commission, Royalty Income and Other Operating Revenue for the year ending 31-Mar-2022.


Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 1675.02 Crore, down -17.39 % from last quarter Total Income of Rs 2027.62 Crore and up 55.42 % from last year same quarter Total Income of Rs 1077.75 Crore. Company reported net profit after tax of Rs 59.02 Crore in latest quarter.

Investment Rationale
TMX is currently trading at a P/E of 56x on a 1 year forward basis, which is well above its 1 year average P/E of 46x, implying limited room for further upside in the near term. Therefore, it revises rating to REDUCE and value TMX at a P/E of 43x on FY24E EPS with a TP of Rs. 2,178.

Promoter/FII Holdings
Promoters held 185.94 per cent stake in the company as of 30-Jun-2022, while FIIs owned 43.17 per cent, DIIs 39.9 per cent.