KR Choksey has given Accumulate recommendation for Balkrishna Industries with a target price of Rs. 2290 in its research report issued on Feb 16, 2022
KR Choksey’s research report on Balkrishna Industries
Revenue exceeded estimates due to higher volumes at 70,320 Mt (+17.6% YoY). Revenue stood at INR 20,458 Mn (+35.6% YoY). For 9MFY22, the geographical revenue mix for Europe stood at ~54%, America at ~18%, India at ~17% and for ROW it was at ~12%. EBITDA stood at INR 4,567 Mn (-4.8% YoY), with OPM at 22.3% (-945 bps YoY). The company has zero long term debt and cash holdings of INR 19.27 Bn as on Q3FY22. The Board has declared 3rd interim dividend of INR 4 per equity share and special dividend of INR 12 per equity share.
On the back of continued strong revenue growth performance and a better outlook for FY23E due to planned capacity additions, we to apply a P/E multiple of 23x on FY24E EPS of INR 99.6 (earlier 27.0x on FY24E EPS of INR 99.6) to arrive at target price of INR 2,290 per share (earlier INR 2,700), implying an upside potential of 14.3%. Accordingly, we maintain our “ACCUMULATE” recommendation on the shares of Balkrishna Industries.
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At 13:55 hrs Balkrishna Industries was quoting at Rs 2,006.05, up Rs 3.25, or 0.16 percent.
It has touched an intraday high of Rs 2,056.40 and an intraday low of Rs 1,980.00.
It was trading with volumes of 16,777 shares, compared to its thirty day average of 16,372 shares, an increase of 2.47 percent.
In the previous trading session, the share closed down 5.80 percent or Rs 123.30 at Rs 2,002.80.
The share touched its 52-week high Rs 2,724.40 and 52-week low Rs 1,516.80 on 23 September, 2021 and 23 February, 2021, respectively.
Currently, it is trading 26.37 percent below its 52-week high and 32.26 percent above its 52-week low.
Market capitalisation stands at Rs 38,780.39 crore.