The shares of Cello World dropped more than 2.5 percent on December 16 after Investec initiated a 'Sell' call on the stock, with a target price implying downside potential to the stock.
Cello World shares fell to Rs 557 apiece, snapping a five-session losing streak.
Investec kept a target price of Rs 530 apiece for the shares of the company, implying a downside potential of around 7 percent from the stock's previous closing price of Rs 571.30 per share.
The domestic brokerage said that around 30 percent of Cello World's portfolio faces near-term macro headwinds, pressuring growth and EBITDA margin. It added that scaling of its glassware segment appears challenging in the middle of competition. This will likely cap EBITDA near 25 percent, lower than guidance.
Investec said FY28E EBITDA and PAT estimates are 26 percent and 22 percent respectively below consensus, with further downgrades possible.
Cello World shares had made a decent debut on stock markets in November 2023, listing at Rs 829 per share on NSE. This marks a premium of nearly 28 percent from the IPO price of Rs 648 per share.
The stock is currently down more than 14 percent from its IPO price, and around 33 percent lower than its listing price. The shares of the company have dropped over 9 percent in the past one month, and nearly 8 percent in the past six months. The stock is down over 26 percent in 2025 so far.
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