Prabhudas Lilladher's research report on Pidilite Industries
However, worst seems over given 1) sustained growth in Tier1/2/3 cities and hopes of revival in Tier4/5 in 4Q23 and 2) 58% correction in VAM prices from peak and likelihood of 4Q exit margins entering guidance band of 20-24%. Long term trends remain favorable with 1) pick up in real estate, repair & renovation activity 2) plans to launch 1-2 innovations every quarter for next 12-18 months 3) targeted increase in ratio of Pioneer and Growth categories from current 33% to 50% over next 3 years and 4) gains from increased distribution reach in rural India and small towns. We estimate 26.8% EPS CAGR over FY22-25. PIDI trades at 48.7xFY25 EPS which leaves limited room for re-rating despite encouraging long term outlook. Retain Hold.
Outlook
We cut FY23/FY24/FY25 EPS estimates by 8.6/9.8/9.4% and DCF based target price to Rs2500 (Rs2679 earlier) tepid sales growth and margin recovery in 3Q23.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
