Buy Jyothy Labs, target price Rs 250: ICICI Securities

ICICI Securities has buy call on Jyothy Labs with a target price of Rs 250. The current market price of Jyothy Labs Ltd. is Rs 194.9.

Jyothy Labs Ltd., incorporated in the year 1992, is a Mid Cap company (having a market cap of Rs 7151.39 Crore) operating in FMCG sector.

Jyothy Labs Ltd. key Products/Revenue Segments include Personal Care and Scrap for the year ending 31-Mar-2022.



Financials
For the quarter ended 30-09-2022, the company reported a Consolidated Total Income of Rs 664.54 Crore, up 8.86 % from last quarter Total Income of Rs 610.43 Crore and up 12.61 % from last year same quarter Total Income of Rs 590.11 Crore. Company reported net profit after tax of Rs 65.35 Crore in latest quarter.


Investment Rationale
The brokerage increases earnings estimates by 3-5% for FY23-24E. It models revenue / EBITDA / PAT CAGR of 11 / 29 / 41 (%) over FY22-24E. It maintains BUY with revised DCF-based target price of Rs250 (was Rs220). At target price, the stock will trade at 28x P/E multiple Mar-24E. Key downside risks are high competitive pressure and RM inflation impacting margins.

Promoter/FII Holdings
Promoters held 62.89 per cent stake in the company as of 30-Sep-2022, while FIIs owned 11.47 per cent, DIIs 17.47 per cent.