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HomeMarket NewsAarti Industries shares may rise 30%, says UBS after giving the stock a double upgrade
Of the 23 analysts that have coverage on Aarti Industries, 11 have a "buy" rating, three have a "hold" rating and nine have a "hold" rating.
Brokerage firm UBS on Wednesday, May 28, projected a 30% upside on Aarti Industries shares, after double-upgrading the stock to "buy", from its earlier rating of "sell."
UBS has raised its price target higher on Aarti Industries ₹625 per share from ₹615 earlier. The stock ended the previous session at ₹478 apiece.
The brokerage said its earlier "sell" rating was set against the backdrop of a peaking chemical cycle and risk to guidance and consensus expectations for the energy segment (Mono Methyl Aniline or MMA).
These factors, according to UBS, have largely played out. Going forward, there is now likely to be a meaningful improvement in these metrics, aided by the new CEO's strategic initiatives to optimise costs and new growth drivers.
The gradual improvement is also likely to be aided by low channel inventory, a steady pick-up in MMA volumes which was already visible in the last two quarters and strategic initiatives, UBS said.
Shares of Aarti Industries are trading below their five-year average Enterprise Value-to-Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA).
Of the 23 analysts that have coverage on the stock, 11 have a "buy" rating, three have a "hold" rating and nine have a "hold" rating.
Shares of Aarti Industries were trading 0.86% higher at 482.55 apiece at 10.25 am on Wednesday, May 28. The stock has gained 11.2% in the past month.
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