Astral Ltd. share price target

We expect revenue and PAT CAGR of 19% and 17.5% over FY21-24E and recommend HOLD' with TP of Rs 2,250.

We recommend BUY with a target price of Rs 2,250/share (upside of 17%) valuing the stock at 65x FY22E.

Astral's Q4FY21 result was a beat to our and consensus estimates on key parameters. Strong demand in both pipes and adhesive segment led to healthy net sales growth, while cost cutting measures supported margins improvement. Net sales improved by 79.3% YoY to Rs11.2bn, while EBITDA was up by 126% YoY to Rs2.5bn. The company reported net profit of Rs1.7bn, growth of 241.3% YoY. Though there is marginal weakness in demand in April, 21 due to Covid-19 led state wise lockdown, the management remained confident to grow as things normalize. We believe the company is well placed to benefit from capacity expansion plan to cater to incremental demand,...

Growth trajectory to get steeper on strong demand

Astral Ltd has reported an all-round performance in Q4FY21 with revenue and PAT coming in much ahead of our expectation. Consolidated revenue growth at 79% YoY to | 1128 crore was ahead of our expectation of 36% growth. This was mainly driven by strong performance of both piping and adhesive businesses. Standalone piping revenue increased 80% YoY to ~| 910 crore supported by ~26% YoY growth in volume. Strong demand from housing and construction segment helped drive volumes in Q4FY21. On the adhesive front, segment revenue growth at 78% YoY to | 241 crore...

Plastic Pipe Sector Review Q3FY21

Astral Poly Technik's (ASTRAL) Q3FY21 consolidated revenue/EBITDA/PAT grew 35.1%/62.4%/83.4% YoY to INR898cr/INR192cr/INR125cr.

We upgrade the stock to BUY (from HOLD earlier) with a target price of Rs 2277/- (upside of 17%) valuing the stock at 65x FY22E.

Astral Poly Technik Ltd. has announced its foray in to the business of manufacturing /trading of plastic water storage tanks and adding new capacity

With outstanding performance in H1FY21, we have re-worked our estimates for the rest of the year and FY22. We have revised our estimates upwards with change in business sentiments and opening of economy, and expect the company to post Revenue/PAT growth at CAGR of 13%/20% respectively over FY20-22

Astral Poly Technik's (Astral) Q2FY21 result was ahead of our and consensus estimates on key parameters. Strong demand in plumbing pipes led to healthy sales growth, while better product mix and prudent cost savings aided EBITDA margin. Net sales improved by 10.1% YoY to Rs7.4bn, EBITDA was up by 20.7% YoY to Rs1.4bn. The company reported net profit of Rs879mn, growth of 6.5% YoY. The management guided that strong recovery in demand post a subdued Q1FY21 led to higher sales volumes in piping industry. Further, the company expects demand traction to continue in H2FY21E, supported by recovery in metros. Astral's capacity expansion plan to cater to...

Adhesive segment demand recovery was impressive post easing of restrictions with ~30% sales growth in Q2FY21. Low base, completion of its distribution realignment strategy yielded a better-than-expected performance. On the piping front, strong demand recovery was seen from September 2020 onwards, which continued in October as segment sales growth for September, October was as high as 30%, 85% YoY, respectively....

Astral Poly Technik (ASTRA) Q2FY21 numbers were above our estimates on revenue front and profitability front. Volume growth of 2.2% YoY and 62.4% QoQ in pipe segment as end markets opened up and company had inventory ready and robust distribution network. Pipes business showed a positive growth YoY from Sep'20 onwards. Adhesive segment from the month of July showed a positive growth after a subdued previous quarter. Margins on a full year showed growth as structural changes of eliminating stockists was undertaken....

Astral Poly Technik's (ASTRA) consolidated revenue grew 10% YoY in Q2FY21, aided by 31% growth in the adhesives segment whereas pipes grew 4% (volumes up 2%).

On a consolidated basis, Revenue/EBITDA/PAT for the quarter grew by 10.1%/20.7%/11.9%

On a consolidated basis, Revenue/EBITDA/PAT for the quarter de-grew by 33.4%/41.7%/57.7% which above of our estimates.

Piping segment demand recovery was led by semi urban, rural areas that were less impacted by pandemic. Astral recovered ~90% of piping sales volume in May-July 2020 despite nominal sales from metro regions. Further, opening of metro regions coupled with its plan to enhance dealer networks across semi urban and rural regions would help in a faster sales recovery from H2FY21E onwards. On the adhesive side, the demand recovery was impressive post ease in restrictions with ~26% sales growth in July 2020. Low base and completion of its distribution realignment strategy yielded a...

Astral Polytechnik reported a relatively tepid Q1, with revenue down to Rs 404 cr (33% YoY decline) as the company sold 21784 MT pipes (?31% YoY against our expectations of almost 50% decline). We retain SELL rating on Astral Poly with target price of Rs 758/-.

Astral Poly Technik's (Astral) Q1FY21 result was better than our estimates on net sales and EBITDA, while PAT was a big beat owing to lower tax outgo. Net sales declined by 33.4% YoY to Rs4bn, EBITDA was down by 41.7% YoY to Rs543mn and adjusted PAT was lower by 57.5% YoY to Rs203mn. The company's piping segment started operation from first week of May, while adhesive segment resumed operation from second half of May. Lower production and nationwide lockdown weighed on Astral's Q1FY21 performance. However, on a positive note, plastic pipes/adhesives were operational at 95%/90% capacity respectively in July. The management's prudent strategies on new...