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Mar 09, 2012, 04.19 PM IST
CRISIL Research has come out with its report on Somany Ceramics. The research firm has maintained the fundamental grade of 4/5 to the company in its March 7, 2012 report.
CRISIL Research has come out with its report on Somany Ceramics . The research firm has maintained the fundamental grade of 4/5 to the company in its March 7, 2012 report.
A reputed player in the Indian tiles industry, Somany Ceramics Ltd’s (Somany’s) strength lies in its established brand name and pan-India distribution network. Focus on value-added products and the decision to postpone greenfield expansion were steps in the right direction; we expect this strategy will help reduce the balance sheet stress without restricting growth. We retain the fundamental grade of 4/5, indicating superior fundamentals relative to other listed equity securities in India. However, slowdown in the real estate industry and rising operating costs could impact future prospects.
Focus on value-added products to aid margin expansion in FY13
Strategic decision to hold capex; outsourced manufacturing contribution to increase
Slowdown in the industry, rising costs may impact future prospects
Revenues to grow at a two-year CAGR of 21%, RoCE to increase
Valuations – current market price has strong upside
Disclaimer: This report (Report) has been commissioned by the Company/Investor/Exchange and prepared by CRISIL. The report is based on data publicly available or from sources considered reliable by CRISIL (Data). However, CRISIL does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. Opinions expressed herein are CRISIL's opinions as on the date of this Report. The Data / Report are subject to change without any prior notice. Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The Report is not a recommendation to buy / sell or hold any securities of the Company. CRISIL especially states that it has no financial liability, whatsoever, to the subscribers / users of this Report. This Report is for the personal information of the authorized recipient only. This Report should not be reproduced or redistributed or communicated directly or indirectly in any form to any other person or published or copied in whole or in part especially outside India, for any purpose.
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