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Buy Nalco; target of Rs 93: Motilal Oswal

Motilal Oswal is bullish on Nalco recommended buy rating on the stock with a target price of Rs 93 in its research report dated June 28, 2021.

June 30, 2021 / 03:09 PM IST

Motilal Oswal's research report on Nalco


Nalco (NACL)’s 4QFY21 result was strong, led by higher LME prices and lower costs. It reported EBITDA of INR9.4b (+118% QoQ) and PAT of INR6.3b (+162% QoQ). We raise our FY22E/FY23E EBITDA estimate by 43%/27%, factoring in higher aluminum prices, which should support strong cash flows and a good dividend payout. Maintain Buy.



Outlook


We value the stock on an SoTP basis at 5x FY23E EV/EBITDA and a 0.75x book value for growth CWIP to arrive at TP of INR93. At CMP, it provides an attractive dividend yield of ~6%. Maintain Buy.

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first published: Jun 30, 2021 03:09 pm
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