Supreme Industries Q3 Results Review - Healthy, Inline; Strong Volume Growth To Sustain: Systematix

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Report.Supreme Industries Ltd.’s Q3 revenue/Ebitda/profit after tax (6%/25%/22% YoY) came inline with our estimates. Overall volumes rose 14% YoY (inline) led by pipes division (up 17%). Packaging (up 3%) and consumer (down 3%) remained in low growth lane. Despite lower mix of value-added-products (~35%), Ebitda margin came healthy at 15.5%. Pipes realisation fell ~7% YoY and QoQ, tracking PVC price trend; Ebit (Rs 17/kilogram, 13% margin) came broadly stable QoQ..Domestic PVC/ CPVC industry grew 15%/2% YoY over nine months FY24, while Supreme Industries grew 25% plus 8% respectively indicating market share gains. Tracking 24% overall volume growth (30% in pipes) in 9 million, management has further upped its FY24 volume growth guidance to 30%, led by pipes..Acquisition of Parvati Agro Industries Ltd. will boost capacity by 36 kt (including 3 kt of O-PVC pipes). A Rs 10 billion capex plan (to be funded via internal accruals) will enhance total capacity to 1 million tonne (pipes capacity to reach 750 kt by FY24 end versus 600 kt currently)..We maintain estimates and expect 14%/20%/18% compound annual growth rate in revenue/Ebitda/PAT over FY23-26E, on healthy ~20% volume CAGR and normalised Ebitda margins (15%+). Despite high capex, Supreme Industries should sustain strong free cash flow and healthy return on equity/return on capital employed (~21%/26% in FY26E). On rich valuation, we maintain 'Hold' with an unchanged Rs 4,000 target price (35 times FY26E price/earning)..Click on the attachment to read the full report:.UltraTech Cement Q3 Results Review - Profitability To Improve; Expansion To Support Growth: Dolat Capital.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Supreme Industries Q3 Results Review - Healthy, Inline; Strong Volume Growth To Sustain: Systematix

Pipes volume growth guidance further upped to ~30% YoY in FY24.

Choose a plan