Dolat Capital is bullish on Gulf Oil Lubricants has recommended buy rating on the stock with a target price of Rs 1056 in its research report dated May 18, 2017.
Dolat Capital's research report on Gulf Oil Lubricants
GOLIL delivered a strong volume growth of 10% for the quarter and we expect this trend to continue. Gross margin expansion on a sequential basis was as expected and we believe that gross margins should not expand from these levels for FY18. GOLIL is confident of delivering at least 2x – 3x volume growth as compared to the industry.
This growth would be driven by the new product launches, expansion of distribution channels and focus on gaining more OEM tie-ups. Improvement in the working capital cycle further improves the balance sheet. We retain our rating to BUY with a target of Rs 1,056 (30x FY19E earnings).
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