Greenply Industries Q1 Review— Soft Performance Better Days Expected Ahead, Says Anand Rathi Retaining A Buy
Anand Rathi retains Buy recommendation on the stock, with a higher 12-month target price
(Source: Company website).
Greenply management expects recovery in Q2, due to the festival season and H2 driving stronger offtake. The brokerage expects 13%/51% revenue/ earnings CAGRs over FY25-28.
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Anand Rathi Report
Greenply Industries Ltd.’s Q1 revenue grew 2.9% YoY to Rs 6 billion. Easing input costs pushed the gross margin up 205 bps YoY to 42.8%. Higher employee and other expenses restricted the Ebitda margin improvement to 34bps YoY, to 10.3%. Adjusted PAT fell 27.6% YoY to Rs 240 million.
PAT fell chiefly due to more losses at the joint venture/subsidiaries apart from higher, 77.9% YoY, interest expenses, partly offset by higher, 129.3% YoY, other income.
We expect 13/51% revenue/earnings CAGRs over FY25-28, chiefly due to the low base and greater share of the high-margin MDF business.
We retain our Buy recommendation on the stock, with a higher 12-mth target price of Rs 427, 22.5x the average FY27e/FY28e EPS (earlier Rs 387, 22.5x FY27e EPS).
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