Target: ₹442

CMP: ₹313

La Opala clocked sales of ₹82 crore (+155 per cent year-on-year), EBITDA of ₹32.7 crore (+243 per cent year-on-year) and PBT of ₹27.6 crore (+139 per cent). Sales and EBITDA grew at CAGR of 12 per cent/10 per cent, while PAT remained flat over Q1 FY20-23. Gross margins and EBITDA margins stood at 92 per cent and 40 per cent respectively. Gross margin usually stands at elevated level in Q1 as company manufactures higher white plate inventory for the upcoming festive season.

La Opala’s greenfield plant in Sitarganj, Uttarakhand, with 11,000 tonne of capacity has commenced and has started to contribute to total sales from July. Based on the current demand scenario, the management sounded confident that this capacity will get absorbed in two years and will contribute about ₹180 crore to the sales. Apart from this, the company’s greenfield unit in Sitarganj for Borosilicate glass is expected to commence in less than two years. Total capex is ₹70 crore and peak sales would be ₹ 110 crore from this unit. We estimate all these capacities combined can clock sales of ₹650 crore by FY25-26.

Significant capacity addition, venturing into new product category, favourable consumer demand are expected to provide growth impetus to the company over the next three years.

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