Hold Supreme Industries, target price Rs 2317: ICICI Securities

ICICI Securities has hold call on Supreme Industries with a target price of Rs 2317. The current market price of Supreme Industries is Rs 2487.6. Time period given by analyst is 1 year when Supreme Industries price can reach defined target.

Supreme Industries, incorporated in the year 1942, is a Mid Cap company (having a market cap of Rs 31621.43 Crore) operating in 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-2022.


Financials
For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 2092.12 Crore, down -5.36 % from last quarter Total Income of Rs 2210.53 Crore and up 8.25 % from last year same quarter Total Income of Rs 1932.63 Crore. Company has reported net profit after tax of Rs 63.46 Crore in latest quarter.

The company’s top management includes Mr.B L Taparia, Mr.M P Taparia, Mr.S J Taparia, Mr.V K Taparia, Mr.R M Pandia, Ms.Ameeta Parpia, Mr.Sarthak Behuria, Mr.R Kannan. Company has Lodha & Co. as its auditors. As on 30-09-2022, the company has a total of 13 Crore shares outstanding.

Investment Rationale The brokerage is bullish on Supreme Industries for its leadership in the pipe segment. Nonetheless, it has downgraded it to Hold (from Buy) post a ~23% rally in the stock price with a rolled over Dec’23 target price of Rs2,317. Also, the brokerage has slashed its FY23E PAT estimates by ~12% (FY24E unchanged) to account for lower profitability due to inventory loss in H1FY23.

Promoter/FII Holdings
Promoters held 48.85 per cent stake in the company as of 30-Sep-2022, while FIIs owned 15.79 per cent, DIIs 19.09 per cent.