Buy Gravita India; target of Rs 1650: Emkay

Emkay is bullish on Gravita India has recommended buy rating on the stock with a target price of Rs 1650 in its research report dated July 22, 2024.

Broker Research

July 24, 2024 / 12:57 IST

Buy

Emkay's research report on Gravita India

Gravita India (GRAV) clocked consol. volume growth of 29% YoY in Q1FY25, led by lead vol. growth of 43% YoY (on a cyclone-impacted base albeit in line with overall guidance). Also, PAT (after MI) grew 29% YoY. The mgmt indicated FY25 consol. volume growth of >25% YoY, besides reiterating ‘Vision 2028’. The company highlighted progress on the regulatory framework (penalties for non-compliance of BWMR and EPR norms expected soon), with gradual stabilization of AL margins toward spurring volume growth. The mgmt has slightly upped its lead EBITDA/kg guidance to Rs18-19 from Rs17-18, on efficiencies and scale-related benefits. Efforts are under way in new verticals, with due diligence in paper and steel, and pilot in Li-ion.

Outlook

We retain BUY on GRAV, hoisting and rolling-over to Sep-25E TP of Rs1,650/sh (25x target P/E).

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