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Buy Transport Corporation of India; target of Rs 860: Motilal Oswal

Motilal Oswal is bullish on Transport Corporation of India recommended buy rating on the stock with a target price of Rs 860 in its research report dated August 04, 2022.

August 06, 2022 / 09:59 PM IST

"India’s specialty chemicals industry is a decadal growth opportunity and it is still not too late to participate in the value creation process. We prefer CRAMS/CSM players Navin Fluorine (Navin) and PI Industries (PI) as they provide long-term earnings visibility. We also like UPL due to robust growth outlook and reducing debt concerns and SRF due to rising contribution from the chemicals business," JM Financial research report.

 
 
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Motilal Oswal's research report on Transport Corporation of India


TRPC reported a revenue of ~INR9b in 1QFY23 (up 30% YoY, but flat QoQ), 5% above our estimate. Strong growth was seen across Freight, Supply Chain, and the Seaways segment. EBITDA margin stood healthy at 11.5%, up 60bp YoY, but down 180bp QoQ. The same remains robust, led by the strong margin generated in the Seaways segment. Strong operating performance saw PAT grow 66% YoY to INR777m (13% above our estimate). The margin performance is likely to continue ahead as marine freight rates are expected to remain elevated and the high margin return cargo from Myanmar is expected to continue in the near to medium term. It expects to acquire a new ship by the end of FY23.



Outlook


We retain our revenue and earnings estimates for FY24 and maintain our Buy rating with a TP of INR860 (based on 17x FY24E EPS).

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Transport Corporation of India - 050822 - moti

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first published: Aug 6, 2022 09:59 pm
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