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Business News/ Markets / Stock Markets/  Top pick of the week: Axis Securities suggests this multibagger stock to buy
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Top pick of the week: Axis Securities suggests this multibagger stock to buy

The brokerage has a Buy rating on multibagger stock with a near-term target price of ₹2,552 per share

Polycab India shares have given multibagger return of over 265% since its listing in April 2019. Photo: iStockPremium
Polycab India shares have given multibagger return of over 265% since its listing in April 2019. Photo: iStock

Sharing its top stock pick of the week, domestic brokerage and research firm Axis Securities has suggested Polycab India Ltd shares that investors can look to buy as it believes that the company's growth will be driven by various factors over the long run.

“Polycab has maintained the leadership position in the organized C&W segment with a market share of 24%+. Moreover, with superior financial strength, expansion of distribution network into tier-2, and tier-3 cities, and strong brand recall, it is poised to gain market share from unorganised players in both Wires and FMEG segments," the note stated.

The brokerage house believes that the growth for Polycab India will be driven by demand recovery, new product launches, product premiumization, and increasing contribution of exports over the long run. It has recommended a Buy rating on Polycab India shares with a near-term target price of 2,552 per share. 

Polycab’s revenues grew 48% YoY led by pricing and volume growth in both B2B and B2C segments. The FMEG business reported revenues of 308 crore (up 61% YoY). The EPC business grew 31% YoY. Exports business grew 62% YoY, contributing 6.7% to the overall revenue in Q1FY23. 

The management stated that the business was impacted in Jun’22 due to softening of the prices and the macro environment remaining a mixed bag with improvement seen in only a few areas. The management is nonetheless confident about the medium to long-term growth prospects across all the segments, Axis Securities added.

Polycab India – is a leading manufacturer of Cables & Wires. In 2009 the company diversified into EPC business to strategically cater to the Cables & Wires requirement of large infrastructure EPC projects. In 2014 the company entered into the high growth FMEG segment manufacturing fans, switches & switchgears, LED lighting, solar products and accessories. 

Polycab has 25 manufacturing units across Maharashtra, Gujarat, Uttarakhand, and Daman & Diu. The multibagger stock has rallied more than 186% in 2 years, rising from 820 apiece level in July 2020 to currently hovering around 2,350 on the BSE, and is up more than 265% since its listing in April 2019. 

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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Published: 01 Aug 2022, 03:19 PM IST
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