ICICI Direct's reserach report on Siyaram Silk MillsSiyaram Silk Mills’ (Siyaram) Q2FY16 revenues posted a flattish performance in revenues to | 398 crore. Revenue growth was subdued due to a decline in shirting fabric & garment segment The operating margin improved 20 bps YoY to 12.5% due to lower raw material cost as a percentage of sales Consequently, PAT improved 4.8% YoY to | 23.1 croreSiyaram 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 on 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 recommendation with a revised target price of | 1250 (based on 10x FY17E EPS of | 125). However, we advise caution while buying owing to low liquidity in such stocks.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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