Shares of Indigo Paints Ltd gained over 2 percent to Rs 1630.95 8 in early morning trade on August after the company reported strong numbers for Q1FY24.
The company's consolidated net profit grew by 58.26 percent year-on-year (YoY) to Rs 31.51 crore and net consolidated total income jumped 30 percent to Rs 292.24 crore.
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Earnings before interest, taxes, depreciation, and amortization (EBITDA) were up 39.2 percent YoY at Rs 49.1 crore. EBITDA margins expanded by 128 basis points, reaching 17 percent, but contracted by 501 basis points QoQ. Gross margins stood at 47.3 percent, expanding by 214 basis points YoY and 51 basis points QoQ. The year-on-year margin expansion was attributed to deflation in most of the raw material costs.
The company said that the funds raised through the initial public offering in 2021 has been fully utilized as of Q1FY24.
Brokerage firm Nuvama Institutional Equities retained a Buy rating on the Indigo Paints scrip, setting a 12-month target price of Rs 1,970, as the results exceeded their consensus estimates. Nuvama stated in its report, "Indigo has exhibited growth well ahead of the industry in this quarter. We maintain a positive outlook on Indigo’s ability to enhance its presence across states and its plans to scale up the construction chemicals and waterproofing segment."
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