ICICI Direct Bullish On Midcap Consumer Durable Stock, Sees 28% Upside, Jumps 237.89% In 3 Yrs

ICICI Direct initiates a Buy on Kajaria Ceramics Ltd. with a target price of Rs 1680 apiece for a target period of 12 months. The brokerage claims a potential upside of up to 28% from its current level. The strong earnings growth and healthy dividend payout is likely to improve return ratios (RoCEs likely at 25.6% in FY26E vs ~17.7% in FY23), according to the brokerage.

Kajaria Ceramics Ltd. is a Consumer Durable sector midcap company. The company has a market capitalisation of Rs 21,023.56 Crore.

Rating and Target Price

According to ICICI Direct, Kajaria with a net cash balance sheet and superior brand, is a solid play on Tiles sector with expanding reach to tier 2/3 cities. "With gas price decline, sharp margin recovery will be seen in FY24 driving strong earnings growth. We maintain our BUY rating. We value Kajaria at Rs 1680 per share (based on 38x FY26 P/E)," the brokerage has said.

Stock Movement

The stock last traded at Rs 1320.15 apiece on BSE, up 1.86% from its previous close of Rs 1296.10 apiece. Its 52-week high is Rs 1351.05 apiece and 52-week low is Rs 980 apiece. The stock gave 7.53% in 1 week. It gave 18.50% in 3 months and 17.94% positive return in 6 months, respectively. It gave 3.80% positive return in 1 year, and in 3 years, it gave 237.89% strong return. While in the past 5 years, it gave 186.86%b positive return.

About - Kajaria Ceramics Ltd.

Kajaria Ceramics is the largest manufacturer of ceramic/vitrified tiles in India with a current annual capacity of 84.5 mn. sq. meters (MSM) as of FY23. Apart from completed capex of Rs 250 crore on tiles, it is adding 2.4 MSM brownfield capex in Sikandrabad and setting up a plant of 5.1 MSM in Nepal in JV.

Disclaimer

The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.