Rahul Arora, CEO at Nirmal Bang Institutional Equities told CNBC-TV18, "We have been very positive Greenply Industries. Kajaria Ceramic from a two year horizon this is a company that will give you close to about Rs 800 crore worth of operating cash flow which will more than take care of any capex that they have. The company has expanded their capacity by about 55 percent and you have seen that in the results this time around very strong on the EBITDA front as well as in the topline and the bottomline."
"This company can give you about 40 percent CAGR and earnings over the next two years. Valuations are not that expensive; what happens in consumer side when you start benchmarking valuations to return ratios and earnings growth then it does not look that bad. However, if you start looking outside the consumer sector and comparing these companies to other sectors then it might look expensive. However, those sectors may not be able to give you the return ratios or cash flows that a consumer company can give you with a predictability of earnings. So Kajaria is a stock we have 35-40 percent upside and will continue to remain bullish on Green Ply as well as on Kajaria and almost a 40 percent growth with Rs 800 crore of operating cash on the next two years I do not see any reason why people should not be buying into this stock," he added.
Disclosure: No holdings of more than one percent for me or my analyst in the process of plying with the research analyst regulations.
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