Sharekhan Recommends This Stock To Buy For 21.3% Upside, In 1 Year
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Target Price
The Current Market Price (CMP) of KEI Industries Ltd is Rs. 989. The brokerage firm has estimated a Target Price for the stock at Rs. 1200. Hence the stock is expected to give a 21.3% return, in a Target Period of 12 months.
| Stock Outlook | |
|---|---|
| Current Market Price (CMP) | Rs. 989 |
| Target Price | Rs. 1200 |
| 1 year return | 21.30% |
Company performance
KEI Industries reports in-line standalone revenues at Rs. 1353 crore (up 30.5% y-o-y) which was led by strong growth in cables revenues (91% of revenues, up 42% y-o-y). With cables, LT (35% revenue share grew 22% y-o-y) followed by housing wires (29%, up 74% y-o-y). The retail segment (51% revenue share) increased by 39% y-o-y, while sales through dealer/distribution market increased 67% y-o-y to Rs. 580 crore. Additionally, lower interest cost (-34% y-o-y, led by cash purchases and reduction of acceptances) led to a 35% y-o-y rise in net profit at Rs. 92 crore.
Comments by Sharekhan
Sharekhan said, “We retain Buy rating KEI Industries Limited (KEI) with a revised PT of Rs. 1200, factoring in upwardly revised estimates and reasonable valuation.” As a positive outlook, the brokerage firm has identified two factors, “Reduction in finance cost led by a reduction in net debt including acceptances. Revenues from stainless steel wires and EHV sales grew 58% y-o-y and 53% y-o-y.”
About the company
KEI is a leading Indian W&C industry and an EPC player in the power T&D segment. The company services retail and institutional customers and caters to both private and public sector clients. Currently, KEI manufactures and markets power cables and addresses cabling requirements of a wide spectrum of sectors such as power, oil refineries, railways, automobiles, cement, steel, and real estate, etc.
Disclaimer
The above stock has been picked from the brokerage report of Sharekhan. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.
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