Pidilite Industries - March 2013 Results Preview - Motilal Oswal

- We expect Pidilite to post ~21% revenue growth to INR7.86, led by 8-9% volume growth in consumer and bazaar segments, even as industrial chemicals remains under pressure.

- VAM prices have been declining for a while now; however, the benefit has been negated by INR depreciation.

- EBITDA margin is also expected to increase by 40bp YoY to 15.1% on account of higher gross margin and operating leverage.

- PAT is expected to register 12% YoY growth to INR837m.

- Uncertainty regarding the synthetic elastomer project continues and the company is yet to take a call on the project's implementation.

- The stock trades at 26.2x FY14E EPS and 21.7x FY15E EPS. Maintain Buy.

Source : Equity Bulls

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