Moneycontrol PRO

Buy Time Technoplast; target of Rs 100: ICICI Direct

ICICI Direct is bullish on Time Technoplast recommended buy rating on the stock with a target price of Rs 100 in its research report dated Jun 01, 2021.

June 10, 2021 / 12:21 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

ICICI Direct's research report on Time Technoplast


Time Technoplast (TTL) reported strong bottomline growth of 40% YoY in Q4FY21 led by improved EBITDA margin (up 63 bps YoY) and 9% YoY drop in interest outgo (gross debt fell 11% YoY in FY21). On the topline front, TTL’s topline growth was at ~4% YoY led by 7% growth in the value added product categories. For FY21, value added products (~20% of topline) recovery was faster at 87% vs. 83% business recovery in the established product segments. Overall revenue recovery was 84% of its pre-Covid level. In the short-term, business recovery will be again challenged by lockdown related demand disruptions in Q1FY22. Hence, we revise our revenue, PAT estimates downward by 5%, ~12%, respectively. However, the management sees a significant growth opportunity in the next four to five years led by newly introduced CNG cascade/on-board/oxygen cylinders. TTL has received all necessary approvals for its Cascade and On-board CNG cylinders. These are value product categories with EBITDA margin profile higher by 100-200 bps vs. company level margins. On the balance sheet front, FY21 debt was down 11% to Rs 677 crore as debt was repaid through improved cashflow from operations (CFO up 18% YoY).


Outlook


We introduce our FY23 estimates and model revenue CAGR of 16% in FY21- 23E on a favourable base and new launches. We believe improved product mix would help drive EBITDA margin, going forward, which will drive PAT at CAGR of 50%. We maintain BUY rating on the stock with a revised target price of Rs 100 (valuing at 6x EV/EBITDA FY22E, earlier TP Rs 75).


For all recommendations report, 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.

Broker Research
first published: Jun 2, 2021 01:37 pm

stay updated

Get Daily News on your Browser
Sections
ISO 27001 - BSI Assurance Mark