Supreme Industries Shares Gain After Analysts Raise Target Price

Here's what analysts made of the results:

• Retains 'buy' and raises price target to Rs 3,060 from Rs 2,920 earlier, implying a potential upside of 30%.

• Views company as a holistic play on revival in housing, capex, infrastructure, and agri demand, led by diversified product mix and entrenched reach.

• Expects FY23-25 earnings per share CAGR at 25%.

• Says Supreme Industries is a high-conviction, small and medium cap pick for the brokerage.

• Pegs demand slowdown and sharp PVC volatility as key risks.

• Forecasts sales at Rs 9,500 crore, operating margins at 11.7% and volume growth at 26% for the current fiscal.

• Estimates sales, profit after tax to post a compound annual growth rate of 14% and 26% respectively, driven by new capex, housing and capex, government schemes and new launches.

• Maintains 'outperform' rating on the stock and raises price target to Rs 2,670 from Rs 2,100.

• Says capacity expansion and stable PVC prices augur well for the company's medium-term outlook.

• Cuts FY23 Ebitda 4%, but raises FY24-25 Ebitda 13%-14% to factor-in its recent results.

• Overall capacity is to rise by 90kt to 815kt by March. With 500kt in sales in FY23, it provides a long runway for growth.

• The new capacity could reach 65% utilisation in 12–14 months.

• Full-year capex is likely to be Rs 400–500 crore.

• Retains 'buy' on stock and raises target price to Rs 2,900 per share from Rs 2,550 apiece.

• Says incremental capex to yield attractive return ratios, which is a positive.

• The third quarter stands out optically due to gains on low base and channel re-stocking on recent resin up-move.

• Supreme's pan-India manufacturing reach, wide product basket and scale benefits are positives.

• Company's strong cash flow conversion, incremental growth capex and strong bull/sell position are noteworthy.