Fundamental Recommendation

HSIL

Ticker : 500187
BUY: Rs. 282.35
Target: Rs. 315



HSIL is India’s largest sanitary ware manufacturer. The company is engaged in the manufacture and distribution of sanitary ware and glass containers primarily in India. The company operates in two divisions, namely, building products and packaging products. In Q3FY19, the net sales of the company stood at Rs 735.72 crore, up 27.2 per cent from Rs 578.41 crore in December 2017. The company’s net profit stood at Rs 25.5 crore in December 2018, up 63.67 per cent from Rs 15.58 crore in December 2017. The management expects 10 per cent YoY revenue growth from building products segment with operating profit margin of 16-17 per cent in FY20. In the packaging segment, price hikes and higher utilisation rate would aid improvement in profitability. Considering all these factors, we recommend a BUY.