KITEX GARMENTS

Discussion in 'Ask A Query About Your Stock Picks And Portfolio' started by Manna, Jul 23, 2015.

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  1. Manna

    Manna New Member

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    ANY VIEWS ON KITEX GARMENTS ?
     
    Manna, Jul 23, 2015
    #1
  2. Meenakshi Razdan

    Meenakshi Razdan Administrator Staff Member Moderator

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    There is a recent research report by Motilal Oswal which has analyzed the Q1FY16 results:

    With foray into the brands business, we expect strong 20% revenue CAGR along with 400bp margin expansion, driving 34% PAT CAGR over FY15-17. Capital expenditure over the next three years will be limited to INR0.4b-0.5b, thus resulting in significant free cash generation. With huge scalability, strong return ratios and free cash generation, we believe KTG deserves a multiple of 26x one-year forward. We maintain Buy with a target price of INR970, valuing the stock at 26x FY17E earnings.
     

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    Meenakshi Razdan, Jul 24, 2015
    #2
  3. alchemist

    alchemist New Member

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    The market is being spooked by a couple of factors on the Kitex stock:

    1. Questions on Kitex LLC which is a 50:50 JV and not wholly owned by KGL. About what will happen to KCL? Will it be merged with KGL or not? Will existing Kitex lose value here is a concern
    2. Will it be able to meet FY 16 - 650 crores target with a slippage in the first quarter itself
    3. High interest rate costs
     
    alchemist, Jul 24, 2015
    #3
  4. ssharma

    ssharma New Member

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    @Meenakshi ... Target price of 970 by when?
     
    ssharma, Jul 24, 2015
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