Buy Balkrishna Industries: target of Rs 2450: Sharekhan

Sharekhan's research report on Balkrishna Industries

The stock trades at P/E multiple of 17.7x and EV/EBITDA multiple of 12.9x its FY2024E estimates. For Q4FY22, Balkrishna’s results were results ahead of expectations, led by higher-than-expected sales volume growth, though EBITDA margin got impacted due to higher freight costs. We expect Balkrishna continue to deliver robust double-digit volume growth in FY23E, driven by increase in infrastructure activity and pick-up in economic activity and continued market share gains. Timely execution of capex plans, market share gains and entry in new markets would be key growth drivers for the company.

Outlook

We maintain our Buy rating on Balkrishna Industries Limited’s (Balkrishna) with a revised PT of Rs. 2,450 given robust outlook and earnings growth.

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