Century Plyboards - Weak Near-Term Prospects; Outlook Healthy: HDFC Securities

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..HDFC Securities Institutional Equities.We have factored in slower growth for FY24E and expect Century Plyboards India Ltd.’s volume and revenue to pick up from FY25E, driven by demand uptick and capacity ramp-up. We estimate a 14% revenue compound annual growth rate during FY23-26E. We also trim our FY24/25E margin estimates, factoring in rising timber prices. We have cut our earnings per share estimates for FY24/25E by 6/7% respectively. We have introduced FY26 estimates and rolled forward our valuation to 35 times Sep-25E EPS versus March 25 earlier. We maintain our 'Buy' rating on Century with a revised target price of Rs 745/share (35 times Sep-25E EPS)..We recently interacted with the management of Century Plyboards. The management believes that FY24 will remain challenging, owing to muted domestic demand for wood panels and elevated MDF imports. The management expects demand to accelerate from FY25 onwards. Hence, it is continuing with all its planned capacity expansions, which are mostly in the MDF and particle board segments. It expects timber prices to continue to rise for the next 12 months due to fewer plantations compared to demand. Later next year, timber supply is expected to increase, which should moderate raw material inflation. We like Century’s strong franchise (pan-India distribution, aggressive marketing, and a wide range of stock keeping units) and leadership presence in most wood segments. These have driven its market share gains and healthy return ratios. .Click on the attachment to read the full report:.Navin Fluorine - Top Level Exits A Valid Concern: IDBI Capital.DISCLAIMERThis 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.

Century Plyboards - Weak Near-Term Prospects; Outlook Healthy: HDFC Securities

FY24 guidance intact for all segments.

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