ICICI Securities maintains Buy on Cello World, lowers target price to Rs 800

ICICI Securities has maintained a buy call on Cello World with a revised target price of Rs 800 (Rs 940). The current market price of Cello World Ltd. is Rs 596.3 . Cello World, incorporated in 2018, is a Small Cap company with a market cap of Rs 13324.89 crore, operating in Glass sector.

Cello World's key products/revenue segments include Domestic Appliances, Export Incentives and Scrap for the year ending 31-Mar-2024.



Financials
For the quarter ended 31-12-2024, the company has reported a Consolidated Total Income of Rs 569.23 crore, up 13.08% from last quarter Total Income of Rs 503.36 crore and up 7.09% from last year same quarter Total Income of Rs 531.54 crore. The company has reported net profit after tax of Rs 92.50 crore in the latest quarter.

The company?s top management includes Mr.Pradeep Ghisulal Rathod, Mr.Pankaj Ghisulal Rathod, Mr.Gaurav Pradeep Rathod, Mr.Gagandeep Singh Chhina, Mr.Piyush Sohanraj Chhajed, Mr.Pushap Raj Singhvi, Mr.Arun Kumar Singhal, Ms.Sunipa Ghosh, Ms.Manali Nitin Kshirsagar. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-12-2024, the company has a total of 22 Crore shares outstanding.


Investment Rationale
ICICI Securities models Cello World to report revenue and PAT CAGR of 9% and 13.8%, respectively, over FY24?27E. They have cut FY26E earnings by 2% to factor in consumer slowdown and impact of issues in exports of writing instruments. The brokerage values the stock on a DCF-basis at Rs 800 (36x FY27E (implied); Earlier Rs 940). Key risks are higher input prices and steep increase in competitive pressures

Promoter/FII Holdings
Promoters held $Parser.toNumber($MarketsData-marketResults.newShareHolding.summary.promoters.percentage) per cent stake in the company as of 31-Dec-2024, while FIIs owned 7.47 per cent, DIIs 13.54 per cent.