Feb 14, 2017 06:24 PM IST | Source: Moneycontrol.com
Sell SAIL; target of Rs 28: Motilal Oswal
Motilal Oswal is bearish on SAIL has recommended sell rating on the stock with a target price of Rs 28 in its research report dated February 09, 2017.
Motilal Oswal's research report on SAIL
SAIL reported EBITDA loss of INR 0.4b (est. of loss of INR 2.2b) in 3QFY17, as against profit of INR 1.1b in the previous quarter, led by lower volumes and higher raw material costs. Interest/depreciation costs were marginally higher QoQ at INR 6.1b/INR 6.7b. Adj. loss after tax of INR 7.9b rose from INR 6.3b in 2QFY17.
We expect EBITDA margin to improve to INR 40/3,290 per ton in FY18/FY19 (FY17E loss of INR 177) on volume leverage and higher steel prices. However, burden of interest and depreciation would mean SAIL will continue to report losses. Sell.
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