Leading Broking Firm Bullish On This Penny Stock, Recommends Buy For 83% Upside

KR Choksey assigned a "Buy" on Infibeam Avenues Ltd in its recent report published on 22 February 2023. The brokerage sees a robust upside of 83% with a target price of Rs 28 apiece. This is a small-cap penny stock that operates in the IT/Services sector. It has a market capitalisation of Rs 4,108.73 crore. Check below to know more:

Infibeam Avenues' Stock Outlook & Returns

The stock of Infibeam Avenues last traded at Rs 15.35 apiece, down 2.23% as compared to its previous close. The stock is trading near its 52 week low, which is Rs 12.50 apiece, recorded on 11 May 20202. its 52-week high was recorded on 11 March 2022 at Rs 23.10 apiece.

The stock moved down 4.66% in the last 1 week. It moved down 17.25% in the last 1 month and 4.36% in the last 3 months, respectively. It moved down 20.77% in the last 1 year. It moved up 4.51% in the last 3 years. In the last 5 years, it moved down 60.97%.

 

Brokerage's View

Infibeam has been reporting very robust growth in TPVs, GTRs, and NTRs on back of strong demand and favourable payments mix. With additional growth drivers like i) consistently converting EBITDA into free cash, ii) debt-free company and iii) a major capex cycle behind, Infibeam is charting a focused growth strategy for the next 3-5 years. Its new businesses are expected to drive gross margins over the long term once it reaches scale.

 

Valuation - Buy for a target price of Rs 28/share

The brokerage said, "Infibeam is trading at 2.5x/1.8x its FY23E/FY24E Price/Sales (P/S) multiples, respectively. It is similarly trading at P/E multiples of 39.7x/27.2x on its FY23E/FY24E earnings. Given the strong growth witnessed in TPVs and NTRs, we now value the company on a Price/Sales multiple of 3x on FY24E sales. This yields a target price of INR 28 giving an upside potential of 80.6% from the CMP. Accordingly, we maintain our "BUY" rating on the shares of Infibeam Avenues."

 

Disclaimer

The stock has been picked from the brokerage report of KR Choksey. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.