Greenply Industries Ltd - Q4 FY21 Result Update - YES Securities

(Rating: BUY, TP: Rs245, Upside: 13%)

- We believe, plywood industry is on the cusp of revival post 5 years of lull phase as real‐estate industry is set to witness uptick in demand. Additionally, rise in input cost coupled with higher working capital requirements has massively impacted unorganized players. Owing to which organized players has gained market share and this phenomenon is likely to continue in coming years. GIL (~26% market share in organized) is likely to be one of the biggest beneficiaries of the same.

- Going ahead with new capacity expansion of 13.5msqm (adding 54% to existing capacity) & deeper penetration of outsourced brands, we expect revenues to increase by 32% to Rs20.29bn wherein Volumes/Realizations should grow by 30%/4% respectively over FY21‐23E. With increase in share of premium products (~70% of total sales) along with higher operational efficiencies, EBIDTA margins are likely to grow to 12.4%/13% in FY22E/FY23E respectively leading to EBITDA growth of 50% over FY21‐FY23E.

- We have valued the company at 17x on FY23E EPS of Rs 14.4, arriving at a target price of Rs245 (previous target of Rs177) translating into an upside of 13% from current levels. Therefore, we maintain our BUY rating on the stock.

Shares of GREENPLY INDUSTRIES LTD. was last trading in BSE at Rs.209.9 as compared to the previous close of Rs. 215.45. The total number of shares traded during the day was 43890 in over 1148 trades.

The stock hit an intraday high of Rs. 218.8 and intraday low of 209.3. The net turnover during the day was Rs. 9259832.

Source : Equity Bulls

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