Dipen Sheth, Head, Institutional Research of HDFC Securities was all praise for V-Guard Industries and highlighted on how the business has been outstanding in this case.
Shares of V-Guard Industries jumped 4.25 percent intraday on Friday after the company reported a 25 percent increase in its net profit at Rs 46.49 crore for the quarter to September. Net sales during the quarter under review was up 15.26 percent at Rs 559.91 crore as against Rs 485.75 crore in the year-ago period.
Research and broking firm Edelweiss Financial Services has come out with a report on V-Guard Industries and has maintained a hold rating but has hiked the price target to Rs 175 from Rs 163. as Q2 performance was robust, led by strong re-stocking, primarily in UPS, stabilisers & kitchen appliances.
"We are optimistic on growth path and sustained profitability," the research house said.
Management of the company is confident of 15 percent compound annual growth rate on revenue over FY17-19.
Edelweiss expects higher revenue via SKU ramp up with expanding non-South sales and restocking.
The research firm envisages growth prospects to be bolstered by new revenue streams (kitchen appliances) with falling share of low‐growth conventional businesses. The company’s sharpened focus on beefing up dealer network (especially in non‐South areas) instills confidence. At current market price, the stock trades at 40x FY19E earnings per share (EPS).
Dipen Sheth, Head, Institutional Research of HDFC Securities was all praise for V-Guard Industries and highlighted on how the business has been outstanding in this case. He said that it is a company that deserves big fat multiples and are brand leaders in UPS markets, though cables and wires have low profitability.At 11:30 hrs V-Guard Industries was quoting at Rs 215.75, up Rs 8.55, or 4.13 percent. It has touched a 52-week high of Rs 221.50.