See upside in Graphite India , says Bhavin Shah, CEO, Equirus Securities.
Shah told CNBC-TV18, "Graphite India makes electrodes that are used in steel production. One of the six producers in the world, so it is a concentrated industry on a worldwide basis. Graphite India is expected to deliver in our view at least 20% growth in earnings over next two years actually it is more than that. A large chunk of it will come from volume but there are also likely to be price improvement as the global leader Graftech has announced a price increase coming up in a few months from now."
He further added, "Also there is some improvement in the customer base of Graphite in terms of volume production coming through and especially from places like Europe and Graphite India will benefit 60% plus of its revenue is from export. The stock continues to trade at a very sort of low valuation 1.1 times price to book and an earnings of about 8 times FY12 so given very strong earnings growth we do think that Graphite India could deliver pretty good upside and also there is a 4% dividend yield on the stock."
