Moneycontrol
Get App
Last Updated : Aug 16, 2019 01:32 PM IST | Source: Moneycontrol.com

Hold Bharat Forge; target of Rs 430: ICICI Direct

ICICI Direct recommended hold rating on Bharat Forge with a target price of Rs 430 in its research report dated August 14, 2019.

Broker Research @moneycontrolcom
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

ICICI Direct's research report on Bharat Forge


Bharat Forge reported weak numbers in Q1FY20. Standalone revenues came in at Rs 1,347 crore, down 8.6% YoY (domestic revenues down 7.4% YoY and export revenues down 10.8% YoY), tracking 8.9% drop in total shipment tonnage to 60,874 MT. Standalone EBITDA stood at Rs 350 crore, down 17.2% YoY, with attendant EBITDA margins at 26.0% (down sharply by 504 bps QoQ). Margins were hurt by rise in employee costs and other expenses as a percentage of sales. Consequently, reported standalone PAT came in at Rs 174 crore, down 23.7% YoY.


Outlook


However, we continue to derive comfort from the company’s healthy return ratio profile (RoCE 17.0%), ~7% FCF yield (FY20-21E) and limited leverage on balance sheet. Valuing the stock at 20x FY21E EPS of Rs 21.5, we arrive at a target price of Rs 430 and downgrade the stock to HOLD.


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.



Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.
First Published on Aug 16, 2019 01:32 pm
Loading...
Sections
Follow us on
Available On
PCI DSS Compliant