Kotak Securities retains add on Greenply Industries. lowers target price to Rs 172

Kotak Securities has retained add rating on Greenply Industries in the long term and lowered target price to Rs 172 from Rs 187. The stock ended down 0.5% at Rs 160.30 on Monday while the BSE Sensex closed 529.82 points up at 40,889.23.

Company Financials

For the quarter ended 30-09-2019, the company has reported consolidated sales of Rs 380.30 crore, up 8.83% from last quarter sales of Rs 349.45 crore and up 5.04% from last year same quarter sales of Rs 362.04 crore. The company has reported net profit after tax of Rs 26.73 crore in the latest quarter.


Investment Rationale

Greenply reported healthy earnings growth on a year-on-year basis in the second quarter led by expansion in operating margins and benefit of low tax rate, said Kotak Securities. Plywood volume growth in the quarter was low at 2%, said Kotak Securities. Management expects revenue in 2HFY20 to grow by 8-10% YoY, translating into FY20 revenue growth of 7-8%, the brokerage said.