Greenply Industries - 1QFY2012 by Angel Broking,

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Greenply Industries
For 1QFY2012, Greenply reported strong top-line growth of 34.4% yoy to `353cr. EBITDA
margin declined by 92bp yoy to 10.8% mainly on account of forex loses of `5cr. However,
on a qoq basis, EBITDA margin improved by 269bp qoq from 8.1%. EBITDA grew by
23.9% yoy to `38cr due to higher revenue during the quarter. PAT increased by 24.7% yoy
and 119% qoq to `13cr mainly due to higher revenue and margin expansion qoq. PAT
margin fell by 29bp yoy to 3.7% during the quarter on the back of a decline in EBITDA
margin. But, on a qoq basis, margin improved by 198bp on the back of higher
contribution from the new MDF segment and lower forex loss.


Outlook and valuation: We believe the company is well placed to benefit from 1) its
laminates capacity expansion (which increased nearly two-folds in FY2010) and is
expected to achieve 100% utilisation in FY2012; 2) commencement of the new MDF plant
at Uttarakhand, which will achieve around 50% capacity utilisation in FY2012; as well as
3) expansion of its plywood capacity by 3.75mn sq. ft., which is expected to contribute
around `45cr to FY2012 top line. At `234, the stock trades at 5.7x FY2013E earnings. We
maintain our Buy rating with a target price of `270. We may revise our numbers and
target price post interaction with the management.