Investment Imperative's research report on Rushil DecorRushil Decor Limited posted revenues of Rs.75.3 crores in 1Q17, the June quarter, on the back of 19% year on year growth in the medium density fiber or MDF space to Rs. 35.73 crore partially offset by 5% decline in revenues for the Laminates segment to Rs.38.08 crores. However, profit before tax for Laminates space rose by 22% on product mix and lower commodity prices.ValuationsRushil Decor went public in 2011 and its stock has more than doubled since its listing. The company’s operating performance got negatively impacted by particle board sales over the past few years. However, through its exit, reduction of debt and deployment of capital in MDF space has yielded strong results. Over the past one year the stock has grown 193% on the back of high margin and revenue growth business of MDFs.The company is currently trading at 16.5x on enterprise value to earnings before income tax on FY17 estimates. We are revising our earlier target of Rs.402 to Rs.513 in FY18 mainly due to strong performance of MDFs, stabilizing trends in Laminates, improved capital structure and revised earnings estimates.For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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