Hold Century Plyboards (India); target of Rs 550: Sharekhan

Sharekhan's research report on Century Plyboards (India)

For Q1FY2024, Century Plyboards reported weak operational performance led by OPM pressures across verticals barring Plywood. Management lowers revenue growth guidance for Plywood, laminates, and MDF owing to delay in capacity additions, sluggish demand environment and weak Q1 performance. Capacity expansion plans in MDF, laminates, particleboards and Plywood remain intact, although it can get delayed by a few months.

Outlook

We downgrade Century Plyboards to Reduce with a revised price target of Rs. 550, factoring downwardly revised estimates and assigning a lower valuation multiple to factor in near-term demand headwinds.