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Last Updated : Sep 03, 2015 04:19 PM IST | Source:

Buy RSWM; target of Rs 336: Firstcall

Brokerage house Firstcall Research is bullish on RSWM and has recommended buy rating on the stock with a target price of Rs 336 in its research report dated September 01, 2015.

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Firstcall Research's report on RSWM

"RSWM Limited, the flagship Company of the LNJ Bhilwara Group, is one of the largest textile manufacturers in the country, primarily producing the best quality of yarns like synthetic, blended, mélange, cotton, specialty yarns reported its financial results for the Fourth quarter ended 30th June, 2015. The Company’s revenue for the quarter stood at Rs. 7008.00 million, an increase of 3.69% y-o-y from Rs. 6758.60 million, when compared with the prior year period. Net profit increased by 22.26% to Rs. 288.40 million from Rs. 235.90 million, when compared with the prior year period. Reported earnings per share of the company stood at Rs. 12.46 a share during the quarter, as against Rs. 10.19 over previous year period. EBITDA was at Rs. 1077.90 million as against Rs. 871.30 million in the corresponding period of the previous year."



At the current market price of Rs. 292.20, the stock P/E ratio is at 5.53 x FY16E and 5.02 x FY17E respectively.

Earning per share (EPS) of the company for the earnings for FY16E and FY17E is seen at Rs. 52.80 and Rs. 58.23 respectively.

Net Sales and PAT of the company are expected to grow at a CAGR of 9% and 19% over 2014 to 2017E respectively.

On the basis of EV/EBITDA, the stock trades at 3.96 x for FY16E and 3.73 x for FY17E.

Price to Book Value of the stock is expected to be at 1.25 x and 1.06 x for FY16E and FY17E respectively.

"We recommend ‘BUY’ in this particular scrip with a target price of Rs 336 for Medium to Long term investment", says Firstcall Research Report.

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First Published on Sep 3, 2015 04:19 pm
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