Buy Carborundum Universal; target of Rs 402: Axis Direct

Axis Direct's research report on Carborundum Universal

Carborundum’s (CUMI) operational performance in Q3FY18 was broadbased. In an inflationary situation, CUMI did well to improve margin (up 120 bps at ~17%) as it was able to get price hikes. Management expects the trend to continue over the next few quarters.

Outlook

With strong demand and capacities in place, management expects revenue of ~Rs 32 bn (Rs 21 bn in FY17) over next 2 years. Upgrade to BUY with revised TP of Rs 402 (23x FY20E EPS) as we roll forward to FY20. For all recommendations report, click here

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