Shares of Blue Star Ltd tumbled over one percent on the bourses in the morning session on January 7, after international brokerage Jefferies downgraded the stock.
Jefferies cut its outlook on the stock from 'buy' to 'hold', with a fresh target price of Rs 2,340 per share.
After the 140 percent rally of Blue Star shares seen in 2024, there is limited upside potential for the stock, noted Jefferies. The shares are now trading at 60x FY26E, compared to its historical 5-year average PE of ~41x.
At 9.30 am, shares of Blue Star were trading at Rs 2,201.9, lower by one percent compared to the previous session's closing price.
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In August 2024, Jefferies noted that Amber Enterprises, V-Guard Industries, and Blue Star were among its 'key picks'.
Blue Star is betting for the sales to double in next four years from around Rs 27,500 crore at present as the disposable income in the hands of the middle class grows.
The excessive heatwave that has gripped various geographies in 2024 is another factor that the company said is amplifying its future business outlook. "Given the changing weather pattern, resulting in hotter summers coupled with new and resilient product portfolio in residential and commercial air-conditioning and refrigeration, the Company is optimistic about its future business outlook," said the firm.
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