Review

BLUE STAR 

Ticker : 500067  
FV : Rs 2 
52-Week H/L : Rs 887.00/425.00

We had previously recommended Blue Star in Vol. 36, No. 01, dated October 28, 2019, when the scrip was trading at Rs 832.25. Blue Star offers end-to-end air conditioning and refrigeration solutions to its customers. The scrip was recommended based on the company’s growth prospects. On the consolidated financial front, net sales for Q4FY20 decreased by 18.58 per cent to Rs 1,299.36 crore as against Rs 1,595.84 crore reported for Q4FY19. Subsequently, PBDT also declined by 64.63 per cent to Rs 36.03 crore for Q4FY20 from Rs 101.88 for Q4FY19. It gained a net profit of Rs 8.38 crore in Q4FY20, decreasing by 89.19 per cent compared to the net profit of Rs 77.55 crore gained in Q4FY19. Its financial performance for Q4FY20 was majorly affected due to lost summer season sales. Looking forward, the company expects the demand to bounce back by making its products more affordable through reduced pricing. Hence, we recommend to HOLD.