Uflex Ltd., incorporated in the year 1988, is a Small Cap company (having a market cap of Rs 3952.13 Crore) operating in Packaging sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 2571.77 Crore, up 21.82 % from last quarter Total Income of Rs 2111.09 Crore and up 45.05 % from last year same quarter Total Income of Rs 1773.00 Crore. Company reported net profit after tax of Rs 264.95 Crore in latest quarter.
Investment Rationale
The brokerage believes that the growth in the FMCG and the Pharma segment due to increased demand from consumers, will be one of the major factors in the growth of the business for Uflex Ltd. Additionally, innovation in packaging products coupled with geographical diversification and manufacturing capabilities will have a substantial positive impact on the margins and business operations of the company. The strong and robust financials will enable the company to tackle any adverse factors in the industry with ease. Hence, for FY22E to FY23E the brokerage expects the company to deliver sales growth of 12% & 10% respectively. In addition to the growth in the revenue, it expects the company to deliver strong EBITDA and PAT margins of 21% and 10.6% respectively in FY23E. It estimates for EPS for the year FY22E & FY23E is projected to be ~Rs. 133.75 and Rs. 153.90 respectively. Hence, it initiates coverage on Uflex Ltd and assign a P/E multiple of ~4.75X with a BUY rating, it has arrived at a target price of Rs. 731 that provides an upside of ~38% from the current market price of Rs. 530.5 within an investment horizon of 18 to 24 months.
Promoter/FII Holdings
Promoters held 44 per cent stake in the company as of June 30, 2021, while FIIs held 5.2 per cent, DIIs 20.8 per cent and public and others 30 per cent.
(Disclaimer: Views and recommendations given in this section are the analysts’ own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.
