Buy Parag Milk Foods; target of Rs 330: JM Financial

JM Financial's research report on Parag Milk Foods

Parag Milk Foods (Parag) has created a well-diversified product portfolio and firmly established its brands in the Indian dairy industry. This has helped it become the second largest cheese player in the country, boosting its value-added products (VAP) business to 66% of revenue and aiding a 567bps GPM expansion over the past 3 years

Outlook

We initiate with BUY and a target price of INR 330 based on 24x FY20E EPS (marginally higher than its current trading multiple, which is at a discount to peers such as Prabhat and Heritage Foods). We see 22% upside from the current market price. For all recommendations report, click here

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