ICICIdirect.com's report on Siyaram Silk MillsSiyaram Silk Mills’ (Siyaram) Q1FY16 revenues declined marginally 0.5% YoY to Rs 300 crore. Revenue growth was subdued on account of a decline in the shirting, suiting and garment businessThe operating margin declined 38 bps YoY to 10.3% due to higher employee, processing & other expenses as percentage of salesConsequently, PAT declined marginally by 0.1% YoY at Rs 11.57 crore"Siyaram has traded at relatively inexpensive valuations in the past. Hence, we have always said it is a re-rating candidate. Considering that the company is tapping newer opportunities for growth and spending aggressively on the promotion of its brands, we remain optimistic on its future prospects. Some of its peers in the branded apparel space (with similar fundamentals) are trading at significantly high multiples. We reiterate our BUY rating with a revised target price of Rs 1300 (based on 10x FY17E EPS of Rs 129.6). However, we advise caution while buying owing to low liquidity in such stocks", says ICICIdirect.com research report.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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