ICICI Securitie`s research report on Gravita India
Gravita India’s (GRAV) performance was in line with our estimates. Key points: 1) EBITDA (including hedging gains) was up 22% YoY at INR 1.06bn. 2) EBITDA margin (adj.) was up 20bps YoY (30bps QoQ) at 10.3%. 3) Lead sales volume rose 12.3% YoY at 45.6kt. 4) Capex of INR 1.07bn in FY25 compared to INR 981mn in FY24. Going ahead, management reiterated its focus on volume growth viz. a 25% CAGR, and RoIC of >25% through to FY29.
Outlook
Furthermore, the capex through to FY28E is likely to be INR 15bn, implying that GRAV is fast-tracking capacity expansion. We lower our FY26E/FY27E EPS by 10%/4%, taking cognizance of lower-than-expected ramp-up of aluminium capacity. Additionally, adjusting for the recently concluded QIP, our revised TP works out to INR 2,670 (earlier INR 3,250). Maintain BUY.
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