Buy Wim Plast; target of Rs 491: Anand Rathi

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Anand Rathi 's research report on Wim Plast

The lockdown hurt Wim Plast’s Q4 results. However, a strong 20% EBITDA margin, its net-cash status and FCFs were positives. While furniture will take longer to recover, air coolers (FY20 sales up 12% y/y) may see good growth owing to the distribution-network expansion and greater brand visibility, which will keep Cello a meaningful player in the next 3-5 years (key to a re-rating). At ~8.3x FY22e P/E, we see good potential in the stock from a long-term perspective, given the company’s strong balance sheet and credible management.

Outlook

We maintain our Buy recommendation, with a lower target of `491 (12x FY22e P/E). Recovery in furniture and profitable growth in air-coolers are key monitorables.

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