Supreme Industries Ltd. share price target

Supreme Industries Ltd (SIL) is India's leading player in plastic products; the wide range of offering includes Plastic Piping system, Packaging, Industrial and Consumer products. Q2FY19 revenue grew by 17% YoY but PAT growth was flat at 3.4% YoY...

Supreme Industries Ltd Q2FY19 results Comment Revenue fell by 2.2% to Rs. 1316.17 Cr in Q2FY19 when compared to the previous quarter. On the other hand, it rose by 24.75% when compared with Q2FY18.

Supreme Industries' Q2FY19 results were a miss (after adjusting to construction income) owing to lower than expected volume growth and price cut in packaging segment. Total volume grew by just 5% YoY to 83,173MT while realization increased by 13% YoY in Q2FY19. The company realized Rs808 mn from sale of 38,718sq ft of its Andheri Premises which inflated EBITDA/PAT by Rs531/346 mn respectively. Adjusting to this, EBITDA/PAT grew by 10.7%/2.6% YoY to Rs1,594/727 mn in Q2FY19. The management lowered its volume growth guidance to 10% for FY19 (7% in H1FY19) from 10%-12%. The management maintains its capex guidance of Rs3.5-4 bn for FY19....

Supreme Industries' Q2FY19 performance was led by ~12% YoY increase in realisation mainly due to a thrust on changing the mix towards premium product categories. On the segment front, except packaging products, the other three segments saw revenue growth in the range of 12-37% YoY. The packaging product category recorded a muted performance in Q2FY19 mainly due to lower volume offtake of cross laminated products owing to a delay in the festive season and absence of discounts. The management has...

Supreme Industries: One of the best plays on Building Materials, Capacity additions to drive topline growth, Strong balance lends comfort; Mahindra & Mahindra: Major beneficiary from growth in rural India, New product launches to improve volumes, Robust demand in the tractor segment

Supreme Industries Ltd (SIL) is India's leading player in plastic products; the wide range of offering includes Plastic Piping system, Packaging, Industrial and Consumer products....

Supreme Industries' Q1FY19 results were a miss due to lower than expected volume growth and increased cost pressure. Revenue was up 15.8% YoY to Rs13.5 bn owing to 8.4% volume growth to 99,905mt. Plastic piping/Packaging products/Industrial products/Consumer products volume grew by 5%/10%/23%/15% and value wise it grew by 12%/9%/37%/23% respectively. The management lowered down its volume growth guidance to a 10%-12% from 12%15% with an EBITDA margin of 15.5%-16%. We cut EBITDA/PAT estimates by 4%/10% for FY19 and FY20E both to factor in higher cost and increased tax rates. We cut our TP to Rs1,322 (32x FY20E) from Rs1,437. Maintain ACCUMULATE....

ICICI Securities Ltd | Retail Equity Research Supreme Industries reported a satisfactory performance on a lower base in Q1FY19 with volume, realisation growth of ~8%, ~7%, respectively. The volume growth was largely driven by industrial and consumer product categories that grew 23% and 15%, respectively. Piping segment volume growth at ~5% was largely hit by a slow pick-up in demand from the agriculture segment. On the margin front, a price hike to offset higher raw material prices coupled with...

Sector: Plastic /Mid-Cap | Earnings Update 1QFY19 Background: Supreme Industries (SI) is a plastic product manufacturer and the largest plastic processor in India, processing over 0.37mn MT annually. Company has four business verticals i.e. Plastic Piping (55%), Packaging Products (21%), Industrial Products (16%) and Consumer Products (7%). SI has 22 manufacturing plants situated across India. Company enjoys a significant market share across its business verticals; Plastic Piping (9.48%), Industrial Products (15%) and Consumer Products (13%). Supreme Industries is the market leader in the Packaging Products segments like XLPE (50%), EPE Foam (36%), Cap Cell (30%) and Air Bubble Film (18%). SI's sales...

In our view, Supreme Industries (SI IN) enjoys a strong business moat, with multiple offerings across plastic pipes (7000+ SKUs), packaging, industrial and furniture segments, along with pan-India distribution and manufacturing (25+ plants). We expect capacity expansion (~50k MT per annum being added to the existing ~567k MT capacity) to support volume growth at ~12%. Any volatility in prices of key raw material (PVC resin) is a monitorable, though this largely remains a pass-through for most pipe players. Maintain ADD....