Surya Roshni Ltd ( 500336
) closes
at ₹552.55 with a Gail of +6.0% on
on 09-September-2021 with formation of a Long
Green Candle on Daily Price Chart.
About the Company : Surya is the second largest manufacturer of
steel pipes (contributes 67% to EBITDA) and also the second largest LED
manufacturer in India.
Sector Update : Positive
Financials : Surya Roshni Ltd has posted Net Sales /
Revenue of ₹5554.40Cr & Net Profit ₹156.50Cr in FY2021 and expected to post Net Sales /
Revenue of ₹6220.90Cr & Net Profit of ₹258.80Cr in FY2022 & Net Sales / Revenue of ₹6967.40Cr & Net
Profit of ₹342.40 Cr in FY2023 .
ROE will improved from 12% in
FY2021 to 19.60% by FY2023. ROCE will
increase from 12.30% to 20.8 %during the same period.
Valuations :
The Company is now Trading at X1.20 of its valuations of
FY2021 earnings with ~20% Premium and X0.72 of its FY2022 earnings with
~28% Discount and X0.54 of its FY2023
earnings with ~46% Discount .
Margin
of Safety (1Yr Bond Yield: Value>1 ) is now
1.3 which makes is attractive . The Equity Value Per Share (
Enterprise Value Method ) is ₹552.30
Early Trend:
Demerger of its pipes and lighting segment could unlock significant value.
If We factor its FY2023 earnings/valuations, its Price
arrives at ₹1221.60
Disclaimer : We are / may going to take exposure shortly.
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