Greenply Industries Q1 Review: Soft Performance, But Better Days Ahead
Greenply Industries Ltd.’s Q1 revenue grew 2.9% YoY to Rs 6 billion, with easing input costs pushing the gross margin up 205 bps YoY to 42.8%. However, higher employee and other expenses restricted the Ebitda margin improvement to 34bps YoY, to 10.3%. Adjusted PAT fell 27.6% YoY to Rs 240 million, chiefly due to more losses at the joint venture/subsidiaries apart from higher interest expenses.
Key Highlights of Q1 Results
- Revenue grew 2.9% YoY to Rs 6 billion
- Gross margin expanded 205 bps YoY to 42.8%
- Ebitda margin improved 34bps YoY to 10.3%
- Adjusted PAT fell 27.6% YoY to Rs 240 million
Brokerage Expectations
Anand Rathi expects 13%/51% revenue/earnings CAGRs over FY25-28, driven by a low base and a greater share of the high-margin MDF business. The brokerage retains its Buy recommendation on the stock, with a higher 12-mth target price of Rs 427, 22.5x the average FY27e/FY28e EPS.
Outlook and Valuations
Greenply management expects recovery in Q2 due to the festival season and stronger offtake in H2. The company’s valuation multiples are attractive, with a P/E ratio of 22.5x, lower than its historical average. With a strong balance sheet and a diversified product portfolio, Greenply Industries is well-positioned for long-term growth.
Investment Strategy
Investors with a long-term perspective can consider buying Greenply Industries, given its attractive valuations and growth potential. However, it’s essential to keep an eye on the company’s Q2 results and any potential changes in the market sentiment.
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