Moneycontrol
Feb 14, 2017 01:51 PM IST | Source: Moneycontrol.com

Sell Thermax; target of Rs 770: HDFC Securities

HDFC Securities is bearish on Thermax has recommended sell rating on the stock with a target price of Rs 770 in its research report dated February 09, 2017.

Sell Thermax; target of Rs 770: HDFC Securities


HDFC Securities' research report on Thermax


Thermax’s (TMX) 3QFY17 result was below our estimates. The company continues to report a decline in revenues (-20% YoY for 3QFY17) on the back of a muted order book. 3QFY17 also saw the impact of demonetisation, in the absence of which revenues would have been higher by 4-5%.


Outlook


In our view, with valuations of 27.0x FY19E EPS, a potential recovery in industrial orders is already priced into the stock. Though TMX provides quality business, the current environment does not justify these valuations. Maintain SELL with TP of Rs 770/sh (25x Dec18E EPS).

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