With additional ethanol capacity and high international sugar prices (high export realisations), triveni’s profit is going to jump in coming quarters.
After removing Rs 50 per share from sales of turbines subsidiary and profit of Rs. 8 from Buy back (10% of (350 – 275) i.e. difference between current and buyback price of 350), effective price is 217 (275-58) then PE on trailing quarters will be 10 (on annual EPS of 20 without sale of turbines sub).
PE on expected FY23 EPS of 27 PE is only 8 (based only on ethanol). Due to additional sugar prices and profits from water and engineering business the EPS will be higher.
Water is going to be a big business for triveni.
All in all valuations are very attractive… I think price can easily cross buyback price of 350.
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