Since Century Plyboards shares have increased by more than 800% over the past ten years, they have provided multibagger returns to their long-term investors. Yet throughout the past year, the stock has been under pressure.
The stock has hit its 52-week low, according to the current share price, which on Monday was 466 per share at Rs. On March 23, 2022, it reached a 52-week high of 749; the stock is now down around 38% from that point.
Century Plyboards, the nation’s top producer of plywood, hit a 52-week low today, yet brokerage house and research group ICICI Securities still see value in the company.
“As a result of an inflationary environment and increased timber prices, CPBI is currently experiencing demand and margin challenges. But because of CPBI’s promising development potential, excellent return rates, and robust balance sheet, we still favor it. Following discussions with Century Plyboards’ management, the brokerage stated, “Post-pandemic pick-up in housing demand and more spending on house upgrades.”
With a target price of Rs. 758, ICICI Securities has maintained its “Buy” rating on the company, representing a 58 percent increase over its current price.
A slowdown in home demand and continued high input costs are major risks to the call and could have a negative impact on demand or profitability.
Nonetheless, HDFC Securities kept its “Buy” rating and $715 per share target price on the stock. The brokerage stated, “We like Century for its strong brand (pan-India distribution, active marketing, and a wide variety SKUs), leading presence in most wood sectors, and high return ratios.
The stock continues to receive a “buy” rating from analysts at Nuwama Research, who have set a target price of $663 for each share. The company’s varied product offering, extensive distribution, and well-known brand continue to encourage the brokerage, who is optimistic about the company’s long-term growth potential.
However, the firm has decreased its earnings projections for FY23 and FY24 by 14% and 9%, respectively, due to the current market slump. According to Nuwama, the company’s operating performance in Q3 FY2023 remained sluggish as a result of reduced growth in other important segments and a contraction in the MDF segment’s growth.
disclaimer, The views and recommendations given above are of individual analysts or broking companies and not of O2help.
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