Yes Securities Places Buy On Building Materials Stock, Sees 33% Gains, Jumps 957.9% In 3 Yrs

Brokerage firm Yes Securities a Buy on Greenpanel Industries Ltd. with a target price of Rs. 449 apiece. If you buy the stock at the current market price, it is likely to give a decent return of up to 33% from its current level.

The brokerage recently interacted with Mr. Venkatramani, CFO of Greenpanel Industries Ltd to understand the on-going trends & development.

Greenpanel Industries Ltd operates in the building material sector. It is a small-cap company with a market valuation of Rs. 4,144.81 crore.

Buy stock with a target price of Rs. 449 apiece

Yes Securities said, "Though we remain positive on growth of MDF industry which is likely to come in at 15%CAGR, we believe upcoming domestic capacities and higher imports will keep realizations & margins under pressure. We expect GREENPs MDF volumes to grow by 13%CAGR over FY23-FY25E on account of rapid acceptance of MDF in domestic market & realizations to degrow by 4%, hence revenue should grow by 9% CAGR over similar period. Margins are likely to contract to 24% in FY24E & FY25E, hence MDF's EBITDA growth will be flattish over next 2-years. For Plywood, we reckon volume & revenue to grow by 7%CAGR over FY23- FY25E & margins should be ~8%. Hence, overall, we expect Revenue/EBITDA/PAT to grow by 9%/5%/4% over FY23-FY25E."

The brokerage added, "At CMP, stock trades at P/E(x) of 18x/15x on FY24E/FY25E EPS of Rs19/22 respectively. We have valued the stock at 20x on FY25E EPS & arrived at a target price of Rs449, retaining our BUY rating.

Stock Outlook

The stock of Greenpanel Industries closed 1.10% down at Rs. 338 apiece on NSE. It hit the 52 week high on 22 July 2022 at Rs. 523 apiece and 52 week low on 29 March 2023 at Rs. 255 apiece, respectively.

The stock declined 2.09% in the last 1 week. However, it jumped 3.49% in 1 month and 25.14% in 3 months, respectively. The stock has given 24.25% negative return in 1 year. It has given a multibagger return of 957.9% in 3 years, It has given 735.6% multibagger return since its listing date of 23 October 2019.

Disclaimer - The stock has been picked from the brokerage report of Yes Securities. 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.