KR Choksey recommended hold rating on Solar Industries India with a target price of Rs 1325 in its research report dated August 03, 2018.
KR Choksey's research report on Solar Industries India
Solar Industries India Ltd (SIIL) net sales stood at INR 6147 mn as against INR 4667 mn in Q1FY18 registering a growth of 31.7% YoY and 6.8% QoQ. The superior growth was primarily led by growth from housing & infrastructure segment and export & overseas business. EBIDTA stood at INR 1282 mn (+26% YoY; +9% QoQ) while OPM came in at 20.8% as against 21.8% same quarter last year. EBITDA margins witnessed a dip on account of higher employee costs on the back of commissioning of South African Plant along with higher other expenses pertaining FX translation loss of INR 120 mn.
Outlook
At CMP of INR 1095, the company trades at a P/E x 43.8x FY19E and 31.0x FY20E our earnings estimates. We assign a P/E of 32X on its FY20E earnings of INR 41.4 resulting into a target price of INR 1325/share translating into an upside of 3.1% from CMP of INR 1285/share. We recommend “HOLD” rating on the stock.
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