On Monday, Investec (LON:INVP) reaffirmed its Buy rating on Greenply Industries Ltd (MTLM:IN) with a steady price target of INR420.00. The endorsement follows a recent meeting with Greenply's management, in which the company's business outlook was discussed. Despite a shutdown at its Gujarat MDF plant, management anticipates the event will have a negligible impact on sales figures. The company also conveyed optimism regarding the progress of its joint venture in furniture fittings, aiming for a fiscal year 2025 revenue target of INR1 billion and the potential to generate annual revenues of INR8-9 billion eventually.
Greenply's recent price increases in the MDF segment were highlighted as a positive development, and while further price hikes are expected, the sustainability of these increases remains under observation. Investec has incorporated conservative margin assumptions for both MDF and plywood in its forecasts but acknowledges that there is a potential for upward revisions to these estimates if the company's performance exceeds expectations.
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