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Buy Birla Corporation; target of Rs 1371: HDFC Securities

HDFC Securities is bullish on Birla Corporation has recommended buy rating on the stock with a target price of Rs 1371 in its research report dated January 25, 2021.

January 28, 2021 / 03:49 PM IST
 
 
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HDFC Securities' research report on Birla Corporation

Birla Corp’s (BCORP) 3QFY21 consolidated revenue/EBITDA/APAT surged 4/23/83% YoY to Rs 17.77/3.62/1.50bn respectively, led by healthy realisation and lower opex. Thus, unitary EBITDA firmed up 19% YoY to Rs 998/MT. We continue to prefer BCORP in the mid-cap space for its large retail presence in the northern/central markets and ongoing opex reduction. Further, the ongoing expansion will increase its capacity to 21mn MT by 1QFY23, boosting volume growth visibility.

Outlook

We maintain BUY with an unchanged target price of Rs 1,371 (8.5x Dec’22E consolidated EBITDA).