Fundamental Result Update

Indo Count Q1FY22 Result Update



Indo Count Industries (ICIL) reported revenue of INR759cr (over a low base registering a growth of 126% YoY), 9% higher than our estimate of INR696cr. Strong growth was aided by a V-shaped recovery in the US retail activity, increased spending on Home Improvement products and RoSCTL benefit of INR50cr of Q4FY21. Normalized Revenue came in at INR709cr (excluding the RoSCTL benefit). The revenue also includes a forex gain of INR30cr, which company treats as a part of business income.

 

Valuation & Outlook: We had initiated coverage on ICIL on 03rd June 2021 at a recommended price of INR152 and a BUY rating on the stock with a target price of INR200. Our target price got achieved on 14th July 2021. We have revised our estimates for FY22E and FY23E owing to the strong revenue growth visibility and earnings growth momentum, we expect ICIL to achieve volumes of +20mn in the subsequent quarters to close FY22E with ~85mn metres and FY23E with ~95mn metres, along with steady improvement in operating margins.

 


Tags: FundamentalResult Update


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