Miss across all businesses

Company
11 Mar 2024
5 Min read 
  • Tube Investments of India's 3QFY24 results were operationally weak with a miss across all business divisions.
  •  The next phase of growth is expected to come from new order wins and a recovery in underlying 2W volumes.
  •  FY24E/FY25E consolidated EPS reduced by ~4% each to account for near-term weakness in the standalone business.
  •  The stock trades at 64.3x/51.6x FY24E/FY25E consolidated EPS.
  •  Reiterate BUY rating with a TP of ~INR4,025 based on Mar26 SoTP.
  •  TIINDIA's revenue grew 11% YoY to INR19b, but there was a decline in gross margin and EBITDA margin.
  •  Mobility business revenue declined 15% YoY, while engineering business revenue grew 14% YoY.
  •  Metal Forms Product business revenue grew 6% YoY, while other business vertical revenue grew 32% YoY.
  •  FCF in 3Q stood at INR660m.
  •  The company plans to raise funds in the near term and has incurred capex of INR3b in 9MFY24.
  •  TIINDIA offers a robust growth story with strong cash flows and diversified revenue streams.
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