Nirmal Bang sees up to 60% upside in this stock! Should you buy?

Stock markets globally are going through unprecedented volatility amid the Russia-Ukraine crisis and the Indian market is no exception.
 
Amid the ongoing correction, Nirmal Bang is bullish on Hyderabad-based CCL Products (India) Limited (CCLP) after the brokerage firm interacted with the management of the company in order to understand the impact of the ongoing Russia-Ukraine situation on the company’s volume and overall earnings.
 
The stock has delivered 42 per cent return in the last one year. Long-term investors have made big gains by investing in this stock as it has surged over 2,500 per cent in the last ten years.
 
The brokerage house has a 'Buy' call on the stock with a target price of Rs 600 per share, So, if you compare it with the current market price of Rs 371, the stock has an upside potential of 62 per cent.
 
According to MarketsMojo, the stock is trading at a discount compared to its average historical valuations and has an 'Attractive' valuation.
 
Nirmal Bang noted that the company's revenue share from CIS countries (Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan, Ukraine) is around 20 per cent, of which Russia has a major share. The majority of the containers were on hold post declaration of the military operation by Russia on Ukraine.
 
However, as per the latest circular, shipments have been allowed as it falls under the Foods category. While the shipments are allowed, only one shipping line (Maersk) is currently accepting shipments to Russia, that too only the existing contracts. Therefore, while the management doesn’t expect permanent revenue loss as of now, volume deferment is expected, the brokerage firm said.
 
"Apart from the current Russia Ukraine issue, Covid-19 cases in Vietnam are rising again and the management sounded cautiously optimistic. As of now, there is no material impact on volume offtake as well as production in Vietnam," said Nirmal Bang.
 
"The management is not delaying its expansion plans. Without any earnings and Target Price (TP) revision, we value CCLP at 22x PE on FY24E earnings," it added.