Moneycontrol
Feb 21, 2017 03:28 PM IST | Source: Moneycontrol.com

Buy Rupa & Company; target of Rs 310: ICICI Direct

ICICI Direct is bullish on Rupa & Company has recommended buy rating on the stock with a target price of Rs 310 in its research report dated February 20, 2017.

Buy Rupa & Company; target of Rs 310: ICICI Direct


ICICI Direct's research report on Rupa & Company


Rupa & Company’s Q3FY17 results were above our estimates on the EBITDA and net profit front though revenues were below our estimate. An improvement in EBITDA margin and lower interest expense boosted net profit growth. Revenues for Q3FY17 declined 7.5% YoY to Rs 209.6 crore vs. estimated Rs 227.5 crore.


Outlook


The stock currently trades at a market cap/sales multiple of 1.8x and 1.6x of FY18E and FY19E, respectively. Rupa’s gradual shift from mass segment products to premium segment products leads us to re-rate the stock with a BUY recommendation and target price of Rs 310 (2.0X FY19E market cap/sales).

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