Man Industries share price jumps 7% as Emkay Global initiates coverage with ‘Buy’ rating, sees 27% upside
₹422.95 apiece on the BSE.Emkay Global assigned a ‘Buy’ rating to Man Industries (India) shares with a target price of ₹500 per share, implying a 27% upside.Man Industries stock price has more than doubled within one year, reflecting improved business fundamentals as well as greater visibility on execution of its announced expansion plans. Also, industry tailwinds in the form of demand growth for pipes as well as capacity growth by peers have provided meaningful clarity on Man Industries charting a similar path, analysts said.Also Read: Jio tariff hike impact: Reliance, Bharti Airtel jump, Vodafone Idea share falls 2.5%“We reckon the optimism around such tailwind and growth aspirations are mostly in the price = ‘potential’.
We think the stock is yet to factor in project execution hereon which is expected to double the group’s revenue in 3-4 years = ‘delivery’. This transition from the ‘potential’ to the ‘delivery’ phase is likely to create meaningful shareholder value," said Amit Lahoti, Senior Research Analyst at Emkay Global Financial Services.The brokerage firm expects the company’s margin to expand to 11.1% in FY27E from 9.2% in FY24, with entry into the high-margin stainless steel business.
It sees significant improvement in return ratios. Also Read: BHEL stock soars 4% after company secures ₹13,300 crore thermal power project“Existing business generates mid-cycle ROE of 9-10%.
We estimate an incremental ROE contribution from the Saudi expansion at 4.8% and stainless steel at 3.9%; this would take group ROE to 17.4% and 21.0% in FY27E and FY28E. We believe the market prefers taking a de-risking approach to the company’s project execution, with the next leg of stock re-rating likely to be accompanied by progress on
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