Geojit has given Accumulate recommendation for TTK Prestige with a target price of Rs. 9750 in its research report issued on Jun 07, 2021
Geojit’s research report on TTK Prestige
TTK Prestige Ltd (TTK), the flagship company of TTK group, mainly operates in the Kitchen Appliances segment. The company has 5 manufacturing plants and a strong distribution network, including 620 Prestige Xclusives. We revise upwards our Target to Rs.9,750 (earlier Rs.8,180) and maintain Accumulate rating considering strong performance. Q4FY21 revenue growth was strong at 43%YoY led by growth across all categories, channels and geographies along with price hike (5%-19%). EBITDA margin was at all-time high of 18% (+910bpsYoY) mainly aided by price hike, better channel & product mix, operational leverage, and cost reduction. EBITDA grew by 191%YoY. Sharp surge in commodity prices impacts cost of production, but the company is able to pass on and gross margin improved 310bps YoY. TTK has almost doubled its capacity for cookware segment and has significantly expanded distribution in FY21 in high growth areas.
Second wave of Covid-19 is likely to impact in the near-term, but long-term demand outlook is positive given ongoing vaccination and strong thrust of GoI to revive the economy. We value TTK at 42xFY23E.