Wednesday, March 30, 2016

Garware Wall Ropes Is Interesting After Correction



Trading Idea – After touching all times highs of INR436, Garware Wall Ropes is currently trading at INR335. In research report dated March 16, 2016, Firstcall Research gave target for Garware at INR360 and I am in agreement with this view. 

Idea Rationale – Garware has corrected on global slowdown as 55% of the company’s revenue comes from outside India. However, with focus on India and with improving EBITDA margins, the company’s results will remain decent and valuations are attractive. 

Long-Term View – Garware Wall Ropes has a solid balance sheet and robust operating cash flows. The company is innovation driven and with “Make In India” campaign, I see long-term benefits. Foray in defense sector products is likely to be rewarding. 

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