HDFC Securities maintains Add on Supreme Industries; target price unchanged at Rs 4,110

HDFC Securities maintains Add call on Supreme Industries with a target price of Rs 4,110. The current market price of Supreme Industries is Rs 4,390.85. Supreme Industries, incorporated in 1942, is a Mid Cap company with a market cap of Rs 55292.89 crore, operating in the plastics sector.

Supreme Industries' key products/revenue segments include Plastic Products, Polymers (Traded), Other Operating Revenue, Processing Charges and Export Incentives for the year ending 31-Mar-2024.

Financials

For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 3039.52 crore, up 20.67% from last quarter Total Income of Rs 2518.78 crore and up .45% from last year same quarter Total Income of Rs 3025.98 crore. The company has reported net profit after tax of Rs 261.18 crore in the latest quarter.

The company's top management includes Mr.B L Taparia, Ms.Ameeta Parpia, Mr.Vipul Shah, Mr.Pulak Prasad, Mr.R Kannan, Mr.R M Pandia, Mr.V K Taparia, Mr.S J Taparia, Mr.M P Taparia, Mr.Sarthak Behuria. Company has Lodha & Co. as its auditors. As on 31-03-2025, the company has a total of 13 crore shares outstanding.

Investment Rationale
HDFC Securities expects plumbing demand to recover in FY26 with channel inventories normalizing and government spending reviving. They have modelled 12/ 14/ 20/20% consolidated volume/ revenue/ EBITDA/APAT growth for FY25-27E. They like Supreme for its industry-leading plumbing volume growth, strong margins, healthy return ratios, and robust balance sheet. The brokerage maintains estimates and values the company at 40x Mar?27 EPS and 30.8% holding in its associate Supreme Petrochem at a 30% discount to its current market cap. They maintain ADD rating with a target pricing of Rs 4,110/s.

Promoter/FII Holdings
Promoters held 48.85 per cent stake in the company as of 31-Mar-2025, while FIIs owned 22.94 per cent, DIIs 13.19 per cent.