Add Century Plyboards (India), target price Rs 750: ICICI Securities

ICICI Securities has add call on Century Plyboards (India) with a target price of Rs 750. The current market price of Century Plyboards (India) is Rs 680.55. Time period given by analyst is one year when Century Plyboards (India) Ltd. price can reach defined target.

Century Plyboards (India) Ltd., incorporated in the year 1982, is a Mid Cap company (having a market cap of Rs 15184.41 Crore) operating in Building Materials sector.

Century Plyboards (India) Ltd. key Products/Revenue Segments include MDF Board, Prelaminated Particle Board, Freight & Other Containers, Veneers, Others, Agricultural Products, Other Operating Revenue, Export Incentives, Scrap for the year ending 31-Mar-2022.


Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 894.79 Crore, down -1.28 % from last quarter Total Income of Rs 906.43 Crore and up 93.35 % from last year same quarter Total Income of Rs 462.77 Crore. Company reported net profit after tax of Rs 92.62 Crore in latest quarter.

Investment Rationale
The brokerage continues to like CPBI for its strong growth prospects, high return ratios and healthy balance sheet and believe it will be a major beneficiary of the uptick in housing demand and higher spending on home improvement post the pandemic. However, it downgrades the stock from Buy to ADD due to strong rally in the stock price (~22% over the last 3 months). It maintains estimates and Mar’23E target price of Rs750, set at unchanged 35x PER FY24E. Key risks to the call: 1) Slowdown in housing demand, 2) continuous higher input prices, which may adversely affect demand / profitability.

Promoter/FII Holdings
Promoters held 73.04 per cent stake in the company as of 30-Jun-2022, while FIIs owned 7.01 per cent, DIIs 11.96 per cent.