Gandhi Special Tubes Ltd. share price target

With a cyclical recovery under way in its key user segments (construction equipment, commercial vehicles) and steady prospects in the tractor space, we expect GST to report sales CAGR of 15% over FY21-23E EBITDA margins are slated to remain elevated at ~38% with RoCE inching up to 30% in the aforesaid timeframe (FY21-23E) With low capex spends, GST has a history of rewarding shareholders with healthy dividends and buybacks. We expect the trend to continue with recent dividend declaration of | 9/share for FY21 & buyback announcement...

GST has a history of rewarding its shareholdings through generous dividend payouts and b/s permitted buy-backs. FY17-19, average dividend payout was at ~38% with absolute dividend at | 9/share (~3% dividend yield). We expect generous dividend payouts to continue, going forward as well. Even in the recent past, GST has concluded a buyback wherein the company has successfully bought 9 lakh shares (~6.5% of outstanding share capital) at a price of | 550/share through tender offer route on the stock exchanges....

Gandhi Special Tubes (GST) reported a healthy performance in Q2FY19 with net sales for the quarter coming in at | 33.6 crore, up 12.9% YoY. Corresponding EBITDA in Q2FY19 was at | 12.9 crore with subsequent EBITDA margins at 38.3%, flat YoY PAT in Q2FY19 was at | 10.0 crore, up 15.1% YoY Topline growth of 12.9% can be considered a temporary blip vs. ~30% in last three quarters (Q3FY18, Q4FY18 & Q1FY19). The management attributed it to fewer working days in the quarter with...

Gandhi Special Tubes (GST) reported a robust Q4FY18 performance with net sales for the quarter coming in at | 28 crore, up 29% YoY EBITDA in Q4FY18 was at | 8.7 crore with corresponding EBITDA margins at 30.9%, down 360 bps. Drop in margins was primarily tracking one-time other expenses that included buy-back expense and CSR expense, adjusting for which margins came in at 36.4% PAT in Q4FY18 was at | 6.7 crore, down 4.3% YoY For FY18, net sales were at | 113.9 crore, up 20.8% YoY, EBITDA...

ICICI Securities Ltd | Retail Equity Research Gandhi Special tubes (GST) reported stellar performance in Q3FY18. Net sales for the quarter came in at | 28.1 crore, up 31% YoY. EBITDA in Q3FY18 stood at | 10.5 crore with corresponding EBITDA margins at 37.5% (up 710 bps YoY). PAT in Q3FY18 stood at | 9.3 crore vs. | 6.1 crore in the base quarter. Top line growth for the quarter is encouraging given one of its product going obsolete in the M&HCV; space (contributed ~10% of...

ICICI Securities Ltd | Retail Equity Research Gandhi Special Tubes (GST) reported a healthy Q2FY18 performance (sales up 8.4% YoY, margins up 440 bps YoY) despite one of its main business segment (fuel injection tubes) going off stream due to mandatory conversion to BS-IV norms in the domestic M&HCV; space Net sales for the quarter came in at | 29.8 crore. EBITDA in Q2FY18 was at | 11.4 crore with corresponding EBITDA margins at 38.3%, up 440 bps. Savings were realised across variables viz. raw material...

ICICI Securities Ltd | Retail Equity Research Gandhi Special Tubes (GST) reported a steady Q4FY17 performance, with sales at | 21.7 crore, flat YoY. EBITDA for the quarter was at | 7.5 crore with corresponding EBITDA margins at 34.5%, up 530 bps YoY. A sharp improvement in EBITDA margin is largely tracking savings in power & fuel costs and other expenses PAT in Q4FY17 was at | 7.0 crore, up 13% YoY largely tracking expansion in EBITDA margins and lower effective tax rate...

ICICI Securities Ltd | Retail Equity Research In Q2FY17, Gandhi Special Tubes (GST) reported a robust performance with sales growing 20% YoY to | 26.1 crore. It was largely tracking the robust tractor sales domestically in H1FY17. The M&HCV; segment, however, witnessed lacklustre growth The company reported healthy EBITDA margins of 33.9% in Q2FY17, which is the second consequent quarter of sustained 34-35% EBITDA margin profile. Consequent EBITDA in Q2FY17 was at | 9.3 crore...

ICICI Securities Ltd | Retail Equity Research In Q4FY16, Gandhi Special Tubes (GST) reported a robust performance with sales growing 20% YoY after four quarters of...