Rajesh Exports Q1FY17: Fundamental Analysis - Firstcall India Equity

Firstcall India Equity | April 25, 2016, midnight


SYNOPSIS

  • Rajesh Exports Ltd (REL) is a zero debt company on standalone basis, with its undivided focus and expertise, the company is currently the largest constituent of gold business in the world.

  • The company is the only gold company to have been included in the Global Fortune 500 list of companies.

  • Consolidated revenue for the quarter rose by. 289.04% to Rs. 589167.64 mn from Rs. 151442.56 mn, when compared with the prior year period.

  • During Q1 FY17, consolidated EBIDTA is Rs. 3815.59 mn as against Rs. 3963.39 mn in the corresponding period of the previous year.

  • During the quarter, consolidated net profit jumps to Rs. 2699.08 mn against Rs. 2371.62 mn in the corresponding quarter ending of previous year, increase of 13.81%.

  • During Q1 FY17, consolidated Profit before tax grew 15.21% at Rs. 2732.35 mn against Rs. 2371.62 mn in Q1 FY16.

  • EPS of the company stood at Rs. 9.14 during the quarter, as against Rs. 8.03 per share over previous year period.

  • On July 14, 2016, Rajesh Exports has bagged anI export order worth Rs. 7860 Mn of designer range of gold and diamond studded jewellery and medallions from UAE.

  • On June 08, 2016, the company has bagged an export order worth Rs. 6530 Mn of designer range of gold and diamond studded jewellery and medallions from Singapore.

  • Net Sales and PAT of the company are expected to grow at a CAGR of 71% and 40% over 2015 to 2018E respectively.

 

OUTLOOK AND CONCLUSION

  • At the current market price of Rs.454.35, the stock P/E ratio is at 11.12 x FY17E and 9.59 X FY18E respectively.

  • Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 40.86 and Rs. 47.36 respectively.

  • Net Sales and PAT of the company are expected to grow at a CAGR of 71% and 40% over 2015 to 2018E respectively.

  • On the basis of EV/EBITDA, the stock trades at 3.24 x for FY17E and 2.50 X for FY18E.

  • Price to Book Value of the stock is expected to be at 2.35 x and 1.89 x for FY17E and FY18E respectively.

  • Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.

 

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