Buy Asahi India Glass, target price Rs 404: ICICI Securities

ICICI Securities has buy call on Asahi India Glass with a target price of Rs 404. The current market price of Asahi India Glass Ltd. is Rs 327.15. Time period given by analyst is one year when Asahi India Glass Ltd. price can reach defined target.

Asahi India Glass Ltd., incorporated in the year 1984, is a Mid Cap company (having a market cap of Rs 8073.02 Crore) operating in Glass sector.

Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 829.86 Crore, up 9.91 % from last quarter Total Income of Rs 755.07 Crore and up 38.05 % from last year same quarter Total Income of Rs 601.11 Crore. Company reported net profit after tax of Rs 80.88 Crore in latest quarter.

Investment Rationale
The brokerage likes Asahi’s business as it 1) has a dominant through-cycle automotive market share (~70%) with premiumisation driven content improvement and no EV risk; and 2) is a proxy play to the growing architectural segment demand (e.g. housing, project) where the strategy is to improve product mix. With major capex completed, strong operating leverage and strengthening growth tailwind, it upgrades multiple to 13.5x (earlier: 12x) FY23E EV/EBITDA (Implied PE: 25x FY23E EPS).

Promoter/FII Holdings
Promoters held 54.3 per cent stake in the company as of March 31, 2021, while FIIs held 1.3 per cent, DIIs 0.7 per cent and public and others 43.7 per cent.