JM Financial has buy call on Welspun India with a target price of Rs 100. The current market price of Welspun India Ltd. is Rs 64.3. Time period given by analyst is one year when Welspun India Ltd. price can reach defined target.
Welspun India Ltd., incorporated in the year 1985, is a Mid Cap company (having a market cap of Rs 6432.26 Crore) operating in Textiles sector.
Welspun India Ltd. key Products/Revenue Segments include Rugs, Blankets & Shawls, Traded Goods, Other Operating Revenue, Scrap, Job Work for the year ending 31-Mar-2021.
Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 2247.06 Crore, down -7.83 % from last quarter Total Income of Rs 2437.92 Crore and up 3.38 % from last year same quarter Total Income of Rs 2173.56 Crore. Company reported net profit after tax of Rs 51.03 Crore in latest quarter.
Investment Rationale
Welspun India reported an EBITDA of INR2.3bn below JMfe of INR2.5bn. The Company reported a 7.9% QoQ decrease in revenues to INR22.3bn. Consolidated EBITDA margins came in lower QoQ at 10.2% vs 3Q margin of 11.4%, impacted primarily by surge in raw material and freight cost. Net debt decreased sequentially to INR22.3bn. The capital light expansion at Vapi and Anjar announced in Q3FY21 has been completed during the quarter, with production expected to begin from 1QFY23. Inflation in commodity prices and logistical challenges are likely to result in muted demand environment in the near term. Consequently, the brokerage revises downward earnings/fair value. However, the long term structural story remains intact. Structural drivers like increased emphasis on health & hygiene driven by pandemic, duty reimbursement by GOI, US ban on Xinjiang imports and market share gain on China+1 theme are expected to drive earnings trajectory going forward. Further, FTA with Australia and India’s decision to set up a “trade and technology council” to boost bi-lateral trade between India and EU is likely to bode well for the company
Promoter/FII Holdings
Promoters held 70.36 per cent stake in the company as of 31-Mar-2022, while FIIs owned 8.52 per cent, DIIs 5.25 per cent.
Welspun India Ltd., incorporated in the year 1985, is a Mid Cap company (having a market cap of Rs 6432.26 Crore) operating in Textiles sector.
Welspun India Ltd. key Products/Revenue Segments include Rugs, Blankets & Shawls, Traded Goods, Other Operating Revenue, Scrap, Job Work for the year ending 31-Mar-2021.
Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 2247.06 Crore, down -7.83 % from last quarter Total Income of Rs 2437.92 Crore and up 3.38 % from last year same quarter Total Income of Rs 2173.56 Crore. Company reported net profit after tax of Rs 51.03 Crore in latest quarter.
Investment Rationale
Welspun India reported an EBITDA of INR2.3bn below JMfe of INR2.5bn. The Company reported a 7.9% QoQ decrease in revenues to INR22.3bn. Consolidated EBITDA margins came in lower QoQ at 10.2% vs 3Q margin of 11.4%, impacted primarily by surge in raw material and freight cost. Net debt decreased sequentially to INR22.3bn. The capital light expansion at Vapi and Anjar announced in Q3FY21 has been completed during the quarter, with production expected to begin from 1QFY23. Inflation in commodity prices and logistical challenges are likely to result in muted demand environment in the near term. Consequently, the brokerage revises downward earnings/fair value. However, the long term structural story remains intact. Structural drivers like increased emphasis on health & hygiene driven by pandemic, duty reimbursement by GOI, US ban on Xinjiang imports and market share gain on China+1 theme are expected to drive earnings trajectory going forward. Further, FTA with Australia and India’s decision to set up a “trade and technology council” to boost bi-lateral trade between India and EU is likely to bode well for the company
Promoter/FII Holdings
Promoters held 70.36 per cent stake in the company as of 31-Mar-2022, while FIIs owned 8.52 per cent, DIIs 5.25 per cent.
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