Birla Corp - Performance Set To Improve; Maintain 'Buy': Axis Securities

Axis Securities Report

Birla Corporation Ltd,’s overall performance was impacted owing to higher costs in FY23. Moreover, its operating performance is set to improve on account of-

1. several cost rationalisation initiatives underway,

2. encouraging demand traction emerging from the government expenditures on various infrastructure schemes,

3. a strong position in the demand-accretive central region,

4. ramp up of Mukutban capacity, and

5. higher sale of premium products.

Against this backdrop, we expect the company to register revenue/Ebitda/adjusted profit after tax compound annual growth rate of 12%/15%/23% over FY22-FY25E.

The stock is currently trading at nine times and seven times FY24E and FY25E enterprise /Ebitda and EV/tonne of $78 and $75 respectively.

We maintain our 'Buy' recommendation on the stock and the company at eight times FY25E EV/Ebitda to arrive at a target price of Rs 1,400/ share. The target price implies an upside of 12% from the current market price.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.