Buy Everest Industries; target of Rs 272: SKP Securities

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Buy Everest Industries; target of Rs 272: SKP Securities

SKP Securities is bullish on Everest Industries and has recommended buy rating on the stock with a target of Rs 272 in its November 2, 2011 research report.

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SKP Securities is bullish on Everest Industries and has recommended buy rating on the stock with a target of Rs 272 in its November 2, 2011 research report.

"Everest Industries Ltd (EIL), Incorporated in 1934, offers complete range of building solutions like Roofing, Ceiling, Wall, Flooring, Cladding, Door and Pre Engineered steel Buildings for the Industrial, Commercial & Residential sector. It enjoys 13% market share of AC roofing industry in India. EIL has a building products capacity of 7,10,000 MT and pre engineered steel building capacity of 30,000 tonnes."

"EIL Ltd recorded total income of Rs.185.74 cr in Q2FY12, registering a growth of 28% Y-o-Y basis led by increase in demand. EBITDA margin declined by 122 basis points to 7.2% as compared to 8.4% in same period last year due to increase in cost of raw material. • Net profit grew by 30% to Rs. 6.02 crore as compared to Rs. 4.62 crore in same period last year on account of higher sales and decrease in depreciation and interest cost. EIL is planning to set up a Fibre cement roofing plant in Balasore, Orissa with a capacity of 1,00,000 MT incurring a capex of Rs. 50 crore. This new plant is expected to be operational in Q3FY13. For Q2FY12, Building product division grew by 23%. We expect this division to grow at a CAGR of 13% over FY11- 13E, with the addition of new capacity. Building product division is expected to contribute around 77% in company's total revenue by FY13E."

"At current market price of Rs. 156/-, EIL is trading at P/E of 4.5x and 4.0x of FY12E and FY13E earnings of Rs. 34.4 and 38.9 respectively. We recommend BUY rating on the stock with a target price of Rs 272 (74% upside) in 15 months at the P/E of 7x on FY13 earnings," says SKP Securities research report.    

Non-Institutions holding more than 90% in Indian cos

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To read the full report click on the attachment