Buy Trident; target of Rs 91: IDBI Capital

IDBI Capital's research report on Trident

Trident’s Q1FY18 EBITDA margin was better than our estimates; however, sales growth was slightly below forecast on lower than expected towel volumes. Trident’s sales stood at Rs12,785 mn (-7.1% QoQ, + 3.7% YoY). Nevertheless, EBITDA margin was ~300 bps above our estimate at 21.8% (+209bps QoQ, -27 bps YoY) on stronger-than-expected margins in Paper business.

Outlook

We revise our target price from Rs103 to Rs91 valuing the stock at 9.0x FY19 earnings. Maintain BUY.