Greenlam Industries - Poised For Growth; Looking Beyond Laminates: HDFC Securities

HDFC Securities Institutional Equities

We expect Greenlam Industries Ltd. to outperform laminates industry growth and deliver strong margin in this segment. We expect a 13% revenue compound annual growth rate in the laminate segment during FY23-26E.

Owing to entry into the new ply and particle board segments, we expect a strong 20% revenue CAGR during FY23-26E at the company level. We estimate 29/21% Ebitda/adjusted profit after tax CAGRs for the same period.

We like Greenlam Industries for its leadership positioning in laminates. However, we are cautious of plant ramp-up in the new ply and particle board segments (large capacities added in a short period).

We broadly maintain our FY24/25 APAT estimates and raise FY26E APAT estimates by 2%. We maintain our 'Add' rating with a revised target price of Rs 585/share (33 times March-26E earnings per share).

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