Buy Blue Star: target of Rs 1200: Sharekhan

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26 Aug, 2025 12:21

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Sharekhan's research report on Blue Star

Our interaction with multi-brand consumer electronics outlets indicate strong pent-up demand for air-conditioners (ACs) post the pandemic in Q4FY22 (particularly March) and Q1FY23. Further, soaring temperatures across India and introduction of new energy-efficient models with attractive features would help ease the impact of a 7-8% hike in prices (across brands). Blue Star would continue to outpace the industry by market share gains, backward integration, deeper penetration (launch of affordable mass-premium products) and expansion of distribution network through conventional and e-Commerce channels. The company has low debt, shorter working capital cycle and healthy operating cash flows. We expect Revenue/PAT to clock a CAGR of 23%/43% over FY21-24E. At CMP, the stock trades at ~32xFY24E EPS.

Outlook

We maintain a Buy on the stock with an unchanged PT of Rs.1,200, given that a harsh summer would brighten prospects for its AC business, healthy growth in project business and commencement of new manufacturing facilities.

More Info

At 17:30 Blue Star was quoting at Rs 993.85, down Rs 5.45, or 0.55 percent.

It has touched an intraday high of Rs 1,007.70 and an intraday low of Rs 987.30.

It was trading with volumes of 8,243 shares, compared to its thirty day average of 7,183 shares, an increase of 14.76 percent.

In the previous trading session, the share closed up 0.67 percent or Rs 6.70 at Rs 999.30.

The share touched its 52-week high Rs 1,134.90 and 52-week low Rs 740.05 on 17 February, 2022 and 20 September, 2021, respectively.

Currently, it is trading 12.5 percent below its 52-week high and 34.18 percent above its 52-week low.

Market capitalisation stands at Rs 9,572.16 crore.

For all recommendations report, click here

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