Buy Symphony; target of Rs 1653: KR Choksey

KR Choksey's research report on Symphony

Symphony Ltd posted its Q4FY17 results which were above our estimates, however higher advertisement expense has dragged down margins for the quarter. Net revenue at INR 1840.5 Mn which grew by 33.5% y-o-y and 2.2% q-o-q. Out of which 93% is from air coolers business with growth of 34.4% yoy.

Outlook

With strong brand and business model we anticipate revenue to grow at CAGR of 16.8% and PAT to grow at CAGR of 24.1% between FY15 and FY19E. Currently the stock is trading at a P/E of 36.1x for FY19E EPS, we rate the stock with an “BUY” rating with a target price of INR 1,653 representing an upside of 16.5%.