Accumulate Finolex Cables, target price Rs 663: Geojit

Geojit has accumulate call on Finolex Cables with a target price of Rs 663. The current market price of Finolex Cables Ltd. is Rs 570.8. Time period given by analyst is one year when Finolex Cables Ltd. price can reach defined target.
Finolex Cables Ltd., incorporated in the year 1967, is a Mid Cap company (having a market cap of Rs 8703.78 Crore) operating in Consumer Durables sector.

Finolex Cables Ltd. key Products/Revenue Segments include Electrical Cables, Cables, Others, Scrap and Copper Rods for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 950.31 Crore, up 37.54 % from last quarter Total Income of Rs 690.91 Crore and up 44.17 % from last year same quarter Total Income of Rs 659.17 Crore. Company reported net profit after tax of Rs 144.77 Crore in latest quarter.


Investment Rationale
Given strong vaccine coverage, lower risk to spread and sharp rebound in economic activities, the brokerage expects revenue growth to pick-up. FCL’s strong brand recall, expanding product portfolio, clean balance sheet and strong cash flow generation, gives confidence. It values FCL at P/E of 17x on FY23E and value FCL’s investment in Finolex Industries at Rs.149 with a target price of Rs.663 and recommend to “Accumulate”

Promoter/FII Holdings
Promoters held 35.92 per cent stake in the company as of 30-Sep-2021, while FIIs owned 9.12 per cent, DIIs 16.21 per cent.