Shyam Metalics and Energy saw its shares climb up to 8% after international brokerage UBS initiated coverage with a Buy rating. UBS has set a target price of ₹1,200 per share, reflecting a potential upside of 58%. The firm’s positive outlook is attributed to Shyam Metalics’ strategic diversification and growth initiatives.
As of 9:25 am the shares were trading 6.47% higher at ₹812.60 on NSE.
Key Highlights:
- Target Price: ₹1,200 per share (58% upside)
- UBS Analysis:
- Diversification: Shyam Metalics is transitioning from producing commoditized products to high-value items such as battery-grade aluminum foil.
- Growth and Transformation: The company’s expansion into aluminum and stainless steel, along with its strategic capex plan, is expected to enhance earnings visibility and lower profitability risks.
- Capex Plan: A ₹10,000 crore investment between FY22-27 aims to drive efficiency and expand capacity. UBS forecasts additional EBITDA of ₹26 billion over three years with an expected 39% CAGR in EBITDA and 50% in PBT for FY24-27.
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Shyam Metalics