Birla Corp Q3 FY21 - YES Securities

(Rating: BUY, TP: Rs 1,108, Upside: 54%)

Volume/EBITDA growth for Q3FY21 stood at 3.2% yoy/23% yoy - while it was 1%/2% ahead of our estimates respectively. Capacity utilization amongst the highest in industry - at 92%. We keep our financial projections intact with expectation of volume/EBITDA CAGR at 14.7%/8.8% respectively over FY21E-FY23E. Further, we expect increase in net debt to be limited to ~Rs 4 bn (bear case scenario) over FY20-FY23E with peak net debt/EBITDA of 2.74x in FY21E which should decline to 2.34x by FY23E translating into balance sheet stability. Maintain 8x EV/EBITDA multiple on Sep-22E and arrive at a target price of Rs 1,108 (unchanged). We maintain our BUY rating.

Shares of BIRLA CORPORATION LTD. was last trading in BSE at Rs.720.65 as compared to the previous close of Rs. 721.85. The total number of shares traded during the day was 15680 in over 942 trades.

The stock hit an intraday high of Rs. 733 and intraday low of 706.95. The net turnover during the day was Rs. 11283978.

Source : Equity Bulls

Keywords