Buy Skipper; target of Rs 248: KRChoksey

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26 Aug, 2025 12:21

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KRChoksey's research report on SkipperSkipper Ltd. reported its Q3FY16 results with Net revenue of INR 3,717.7 Mn, growth of 12% YoY basis which is in line with our estimates of INR 3,698 Mn. The EBITDA stood at INR 495 Mn with margin of 13.3% compared to 14.7% YoY and 12.2% on QoQ basis which is lower than our estimates of INR 507 Mn, a decrease of 138bps YoY, on account of higher other expenses, which increased 82% on YoY basis. The PAT remained at INR 187.2 Mn against our estimate of INR 190 Mn with margins at 5% in Q3FY16 as against 5.3% YoY and 8.7% QoQ, an decrease of 25bps YoY.We have reduced our earnings estimates by 18%, 16% and 19% respectively for FY16-18E, to reflect in softer commodity prices. Robust order book providing revenue visibility in T&D business; multifold expansion in PVC business on a pan India level providing scalable growth opportunities reinforces our belief in sustainable superior earnings performance ahead (EPS CAGR FY16-18E - 45.3%). We maintain a BUY and TP of INR 248 based on 16x P/E of FY18E EPS and on 8.78x EV/EBITDA FY18E basis, implying 60% upside from current levels. At CMP of INR 155, the company trades at P/E of 10.02x its FY18E EPS of INR15.47.

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