ICICI Securities Placed "BUY" On Midcap Consumer Durables Stock For 32% Return

ICICI Securities, a leading brokerage firm in its recent recommendation has picked TTK Prestige Ltd, a Midcap stock from the Consumer Durables sector. The brokerage in its report on the stock has shared its view and recommended investors to "Buy" the stock with an estimated target price of Rs 1,000 apiece. The given target price indicated that the stock could give a potential upside of up to 32% if purchased at the current market price. Check below to know more:

TTK Prestige stock outlook and returns over the years

The stock of TTK Prestige last traded at Rs 759.45 apiece. The stock has fallen 2.89% in 1 week, 2.25% in 1 month and 11.06% in 3 months, respectively. It has fallen 11.71% in the past 1 year. It gave 31% positive return in 3 years and 36.75% in 5 years.

The stock's recorded 52 week low as on 27 January 2023 is Rs 694 apiece and 52 week high as on 13 September 2022 is Rs 1,049.90 apiece, respectively. It has a market capitalisation of Rs 10,527.04 crore.

Erasing the tag of a slow growth company; earnings CAGR higher than most peers over FY17-22

ICICI Securities said, "The investors (we spoke to on TTK Prestige) believe that TTK is a slow growth company. TTK reported EBITDA CAGR of just 4.3% over FY12-17, materially lower than its peers. However, we note there is stark improvement in EBITDA CAGR over FY17-22. TTK's EBITDA CAGR was 14.3% over FY17-22, higher than its historical performance as well as its most peers. Chief reasons driving the improvement in EBITDA growth are (1) steady expansion of distribution, (2) expansion in Non-south India markets and (3) investments in new product launches. Considering the growth rates are largely similar to peers but TTK has superior return ratios, we believe its valuation multiples deserve rerating.

It added, "We model TTK to report revenue and earnings CAGRs of 13.3% and 24.4% over FY23-FY25E with (1) mid-single digit volume growth, (2) distribution expansion and (3) market share gains. Maintain BUY with DCF-based TP of Rs1,000 (implied P/E 35x FY25E EPS)."

Disclaimer

The stock has been picked from the brokerage report of ICICI Securities. 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.