Sharekhan's research report on Astral
In Q1, the company reported higher than expected revenues although OPM disappointed due to inventory losses & spends on faucets & sanitaryware. Net profit lagged owing to forex losses & amortisation related to paints business. Q2 may see margin pressures continuing in pipes, led by declining PVC prices. However, expected stabilising of PVC prices in H2FY2023 would lift demand. Its new businesses viz. plastic tanks, Valves, Paints, faucets and sanitaryware would provide a sustainable growth trajectory going ahead.
We retain a Buy on Astral Limited (Astral) with a revised price target of Rs. 2300 owing to strong growth potential in its existing and new businesses.
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