ICICI Securities research report on Astral Poly Technik
Despite a substantial volume loss witnessed in Mar’20 due to nationwide lockdown, Astral Poly Technik (ASTRA) is possibly witnessing a phase of meteoric rise in its margin trajectory. The all-time high Q4FY20 EBIDTA margin, which the management clarified was without any one-offs, is largely attributed to strong gross margin expansion in both the product segments – which were led by the company’s backward integration drive, decentralisation efforts and increasing share of VAPs.
Besides the rising margin trajectory, the sustained focus on strengthening the balance sheet and likelihood of the company being one of the biggest beneficiaries of market share gains in the plumbing pipe segment, ASTRA’s recovery in earnings could be much earlier than anticipated. Upgrade to BUY.
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