Recommendations from Tyres & Allied -Pharmaceuticals

Recommendations from Tyres & Allied -Pharmaceuticals

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations

APOLLO TYRES LTD.

CMP - Rs 242.45
BSE CODE : 500877
Volume : 4,13,718
Face Value : Rs 1
Target : Rs 270
Stoploss :Rs 220​ (CLS)




Apollo Tyres Ltd. is a multinational tyre manufacturing company headquartered in Gurugram, Haryana. The company markets its products under two global brands: Apollo and Vredestein. It has recorded an increase of 59.09 per cent in net sales and operating income from Rs.2,881.74 crore in Q1FY21 to Rs.4,584.47 crore in Q1FY22. The operating profit also improved from Rs.264.13 crore in Q1FY21 to Rs. 607.24 crore in Q1FY22. The quarter flipped the net loss of Rs. 134.56 crore in Q1FY21 to net profit of Rs. 127.77 crore in Q1FY22. Demand recovery is witnessed in both the OEM and replacement market with steady price increases in the replacement segment. Focusing on digitalisation to increase operational efficiencies and drive sales along with controlling capex and brand building, Apollo Tyres is well-poised to tap the recovery in demand. Hence, we recommend BUY.

SUN PHARMA ADVANCED RESEARCH COMPANY LTD.

CMP - Rs.297.55
BSE CODE 532872
Volume 60,638
Face Value Rs.1
Target Rs. 330
Stoploss Rs.275 (CLS)




Sun Pharma Advanced Research Company (SPARC) is a clinical stage bio-pharmaceutical company focused on continuously improving standards of care for patients globally through innovation in therapeutics and delivery. On a quarterly basis, the standalone numbers of the company report net sales and operating income at Rs. 21.99 crore in Q1FY22, a significant decline from Rs. 185.45 crore reported in Q1FY21. The operating profit of Q1FY21 of Rs. 61.44 crore turned into operating loss of Rs. 53.47 crore in Q1FY22. The company reported net loss at Rs. 61.37 crore in Q1FY22 as against net profit of Rs. 88.67 crore in Q1FY21. In early September 2021, the company received board approval to raise funds of up to Rs. 1,800 crore through various modes, including issuance of equity, convertible warrants, preference shares, bonds and debentures. Being optimistic regarding the company’s future prospects and healthy recovery in its financial performance, we recommend BUY.

(Closing price as of Oct 18, 2021)
 

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