After Gaining 2700% From COVID Lows, JTL Ind Hit Record High: Buy?

Shares of JTL Industries are one of the stocks that have produced multibagger returns. After reaching its COVID lows in March 2020, this logistics stock has climbed from about Rs 14.50 to Rs 404 per share on the BSE, registering a gain of close to 2,700% during this period. The stock continued rising on Monday, reaching fresh 52-week highs at Rs 404 before settling at Rs 399.95 with an upside gap of 0.44%.

Domestic brokerage firm Antique Stock Broking is bullish on JTL Industries shares as it has initiated a buy coverage. The brokerage said that JTL Industries' 1QFY24 consolidated revenue at Rs 5 billion increased 37.2% YoY and 6.8% QoQ with higher realization offsetting lower sales volume.

Sales volume came in at 77.3 KT, sharply higher by 52.5% YoY but declined 3.5% QoQ impacted sequentially by lower exports and domestic deliveries.

EBITDA at INR 355 mn was below our estimate, but materially improved 131% YoY and fell 32.7% sequentially. Blended realization at INR 65,269 per ton was 10.1% lower YoY but improved 10.7% sequentially.

EBITDA per ton came in at Rs 4,594, higher 51.5% YoY and fell 30.2% QoQ. Consolidated PAT came in at Rs 254 mn, sharply higher 110.1% YoY and shrunk 30.8% QoQ despite a sequentially lower effective tax rate of 25.2% (27.2% in 4QFY23).

It noted that the company's continued capacity expansion is on track to reach 750 ktpa by FY24 end and 1 mtpa by FY25.
Improved product mix (higher proportion of value-added products), stable steel prices, and higher sales volume will enhance profitability and EBITDA margin.

The brokerage has maintained BUY rating with a revised TP of Rs 511 per equity share.

Another brokerage Axis Securities said that the guidance for sales volume baseline growth for FY24 (minimum which can be surely achieved) is 30-35% on a YoY basis.

With the phase-wise volume expansion progress, the brokerage model Revenue/EBITDA/PAT CAGR of 46%/45%/51% over FY23/25E. It slightly reduced EBITDA estimates for FY24 by 3% to account for lower Q1FY24 numbers, but kept FY25/26 estimates largely unchanged.

It has maintained BUY rating on the stock and value JTL at 22x its FY25 EPS (unchanged) to arrive at our 1-year forward target price of Rs 470.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.