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Last Updated : Sep 18, 2018 03:15 PM IST | Source: Moneycontrol.com

Buy Sterlite Technologies; target of Rs 425: Edelweiss

Edelweiss bullish on Sterlite Technologies has recommended buy rating on the stock with a target price of Rs 425 in its research report dated July 19, 2018.

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Edelweiss' research report on Sterlite Technologies


Sterlite Technologies (Sterlite) reported strong Q1FY19 numbers— revenue jumped 17.8% YoY (Street estimate 22.5%) and EBITDA margin expanded 190bps QoQ to 27.9% (Street estimate 24.4%). This led to PAT catapulting 99.7% YoY to INR1.2bn. Key highlights: 1) OFC utilisation at over 90% & the Metallurgica Bresciana acquisition provides access to additional 3mn fkm capacity, which can be expanded to 5mn fkm; 2) management expects EBITDA margin to remain at 24-25% on higher utilisation & higher contribution of product business; 3) highest-ever order book—INR60.3bn, up ~92% YoY; 4) Metallurgica acquisition likely to expedite USD100mn plus net income target by FY20; and 5) INR35bn naval order to further bolster order book in Q2FY19.


Outlook


We believe, Sterlite is well positioned to capture the robust global growth in fibre consumption. Maintain ‘BUY’ with TP of INR425 (25x FY20E EPS).


For all recommendations report, click here


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First Published on Jul 24, 2018 05:05 pm
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