Nalanda Securities recommended Hold rating on Sterlite Technologies with a target price of Rs 216 in its research report dated April 24, 2019.
Nalanda Securities' research report on Sterlite Technologies
Sterlite Technologies (SOTL) reported Q4 FY19 revenue at INR 1,791 crore; up 111% YoY and 34% Q-o-Q; EBITDA for the company stood at INR 315 crore, up 46% YoY and 8% Q-o-Q; PAT was reported at INR 166 crore; up 38% YoY and 12% Q-o-Q. EBITDA margin reported were 18%; as against 22% QoQ and 26% YoY and PAT margins stood at 9% as against 11% QoQ and 14% YoY. Open order book at Rs 10,516 crore, 2.1 times the annual revenue. With these strong numbers, the Board of Directors has recommended final dividend of INR 3.5/ share for FY’19.
At CMP of INR 207.35, the company is trading at 7.7x FY21E EPS and 5.3x FY21 EV/EBITDA. We value the company using an average of P.E. and EV/EBITDA methodology giving an exit multiple of 8 and 5.5 respectively on FY21 basis, achieving a target price of INR 216 which is an upside of 4%. We have a HOLD rating on the stock.
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