This Stock Can Give 40% Return In 1 Year: Arihant Capital

Brokerage firm Arihant Capital suggests investors buying the stock of India Glycols Ltd. for a 40% return.

Target Price

The Current Market Price (CMP) of India Glycols Ltd. is Rs. 835. Arihant Capital has estimated a Target Price for the stock at Rs. 960. The stock is expected to offer a 40.4% upside, in 1 year.

Stock Outlook
Current Market Price (CMP)	Rs. 763
Target Price	Rs. 1071
1 year return	40.40%

Company performance

The company's Revenue in FY 21 stood at Rs. 2,317 crore, which is expected to grow at Rs. 3,011 crore in FY 22. Their EBITDA in FY 21 was Rs. 268 crore, which is anticipated to be at Rs. 244 crore in FY 22, and Rs. 335 in FY 23. India Glycols Ltd. reported a profit after tax at Rs. 109 crore in FY 21, it is expected to grow at Rs. 282 crore in FY 22. Potable sprits segments account for ~27.4% of total sales in FY21 and witnessed strong growth with CAGR at 34% from the period of FY18-21. This segment is expected to deliver good growth in going forward.

Comments by Arihant Capital

Arihant Capital commented, "IGL has delivered strong growth (34% CAGR in FY18-FY21) in Potable sprits with its debt reduction, grain-based distillery projects, the JV with Clariant, Government initiatives for Biofuels and ethanol blending program and future scope of carbon smart products are expected to drive the business in going forward. The company has undertaken capex for ~Rs. 325 crore for grain based distillery and other miscellaneous capex for FY22." The firm added, "IGL has three business segments, Bio based specialties and chemicals segments account for 66.1% of total revenue as on FY21. Potable Sprits revenue stood at 27.4% and Ennature Biopharma segment stood at 6.5% of revenue in FY21."

About the company

India Glycols Ltd (IGL) was incorporated in 1983, and is the leading manufacturer of green technology based bulk specialty and performance chemicals, sprits, industrial gases, Bio polymers, Bio Fuels, Carbon smart range, Natural gums and Plant based APIs & Nutraceuticals. It engages in the business of Mono Ethylene Glycol (MEG), Ethylene Oxide Derivatives (EOD), Ethyl Alcohol (Potable) and Nutraceuticals. It has a global customer base and partnerships with reputed global companies. Exports accounted for ~11% of total sales in FY21.

(Also read:  Buy This Stock With Rs. 960 Target Price For Good Return: Brokerage Firm)

Disclaimer

The above stock was picked from the brokerage report of Arihant Capital. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.