Gujarat Alkalies can test Rs 175, says Bhavin Shah, CEO, Equirus Securities.
Shah told CNBC-TV18, "Gujarat Alkalies continue to trade at a significant discount to its book value something like 0.6 times book. The industry is basically near the bottom of its cycle, Gujarat Alkalies is the lowest cost producer in India with a key advantage of captive power as well as excess to raw materaial especially salt and we think that with the higher demand from the user industries, the product prices should strengthen driving the stock and even at Rs 175, we are not arguing for any kind of a rich valuation, we are still talking about close to book value kind of valuations. So that is why we think that - that is achievable as the pricing improvement materializes in their output."
Disclosure: We might take positions in the above stock.
