AngelOne has included Blue Star Ltd in its recommended Diwali picks for 2024, assigning a target price of ₹2,570. With a current market price of ₹2,045, Blue Star offers an upside potential of 26%. Known for its robust presence in the consumer durables sector, Blue Star manufactures air conditioning, refrigeration, and water purification solutions, serving both commercial and residential customers.
Quick Overview of Key Financials
| Parameter | Value |
|---|---|
| Current Market Price (CMP) | ₹2,045 |
| Target Price | ₹2,570 |
| Upside Potential | 26% |
| Market Cap | ₹42,044 crore |
| Beta | 0.6 |
| Sector | Consumer Durables |
Key Investment Highlights for Blue Star Ltd
- Leader in Cooling and Refrigeration Solutions
Blue Star has established a strong foothold in manufacturing air conditioners, air purifiers, water purifiers, and specialty cooling solutions. Its turnkey offerings in MEP (Mechanical, Electrical, Plumbing, and Firefighting) projects further solidify its position in the commercial cooling sector. - Significant Revenue and Profit Growth in Q1FY25
In Q1FY25, Blue Star’s revenue surged by 28.7% YoY to ₹2,865 crore, while net profit doubled, growing by 103.6% YoY to ₹169 crore. This strong performance was driven by increased demand during a harsh summer and efficient cost management. - Expansion in Indian Air Conditioning Market
Blue Star is well-positioned to benefit from the growing demand for air conditioning in India. The company’s focus on expanding its distribution network and targeting tier 2 and tier 3 cities is likely to drive further growth. - Focus on Margin Expansion through Cost Control
With a strategic focus on cost control and efficient resource allocation, Blue Star aims to improve its operating margins. The company’s cost-management efforts are expected to yield positive results in the coming years.
Key Financials Overview
| Year | Sales (₹ Cr) | PAT (₹ Cr) | EPS (₹) | OPM (%) | ROE (%) | P/E (x) | P/BV (x) | EV/Sales (x) |
|---|---|---|---|---|---|---|---|---|
| FY2024 | 9,685 | 415 | 20 | 7.4 | 15.9 | 62.9 | 10.0 | 4.0 |
| FY2023 | 7,977 | 401 | 21 | 8.7 | 30.1 | 33.1 | 9.9 | 5.0 |
| FY2022 | 6,064 | 168 | 9 | 6.3 | 16.5 | 60.3 | 9.9 | 7.0 |
Conclusion
Blue Star Ltd’s established brand presence, expanding distribution network, and efficient cost management position it for strong growth in the air conditioning and refrigeration market. AngelOne’s target price of ₹2,570, with a 26% upside, highlights the company’s potential as it leverages rising demand across India.
Disclaimer: This article is based on AngelOne’s research and is intended for informational purposes only. Investors are encouraged to consult a financial advisor and refer to the detailed research report before making any investment decisions.