IDFC Securities has outperform rating on Carborundum Universal, target price Rs 285

IDFC Securities has an outperformer rating on Carborundum Universal with a target price of Rs 285. Shares of Carborundum Universal ended up 0.45 per cent at Rs 243.45 on Tuesday while the BSE Sensex closed 413.89 points down (-1.20 per cent) at 33,956.69.

Carborundum Universal Ltd., incorporated in 1954, has a market cap of Rs 4628.29 crore.

Investment Rationale

The company’s focus on new capacities with a wide product portfolio and innovation would aid market share gains in a difficult environment and drive gradual price hikes and margin expansion, said IDFC Securities. Further, it is eyeing higher exports across segments which would aid performance, the brokerage said.

Financials

For the quarter ended March 31, 2020, the company reported consolidated sales of Rs 586.02 crore, down -8.75 per cent from last quarter sales of Rs 642.21 crore and down -15.75 per cent from last year same quarter sales of Rs 695.58 crore. The company has reported net profit after tax of Rs 93.29 crore in the latest quarter.

Promoter/FII Holdings

Promoters held 42.05 per cent stake in the company as of March 31, 2020, while FIIs held 6.54 per cent, DIIs 28.19 and public and others 23.21 per cent.