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HDFC Securities
IFGL Refractories (Buy)
CMP: ₹152
Target: ₹178-204
IFGL is a manufacturer of specialised refractories and operating systems for the steel and iron industry. It manufactures specialised refractory for flow control of steel and treatment of quality thereof. The Kolkata headquartered company promoted by SK Bajoria Group now has eight manufacturing plants across the globe (in China, UK, Germany, India and US). Buy triggers: a) Large player in key consumable for steel; b) Diversified presence and products to help the company; c) Incremental capacity to drive earnings; d) Available at discounted valuations than competitors. Risks: a) Dependence on raw material imports from China; b) Rising prices of the inputs such as crude oil, alumina, magnesia; c) Any slowdown in the global as well as local economy; d) Foreign exchange risks.
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