Comments
Karvy Stock Broking
Premier Explosives (Hold)
CMP: ₹294.70
Target: ₹315
We expect the explosive business to grow at a CAGR of 6.2 per cent during FY14-17E. Uptick in demand from mining and infrastructure sectors could lead to recovery in the domestic detonator business with CAGR volume and price growth of 5.2 per cent and 4.8 per cent respectively during FY14-17E with a conservative dip in FY15E. We expect ramp-up in production of critical weapons programmes such as Akash and Pinaka leading to increased offtake of propellants by weapon’s integrators. We expect defence business to grow at a CAGR of 28 per cent during FY14-17E as propellants segment expands. Premier’s R&D activities have led to commercialisation of lab scale technologies such as ‘nickel hydrazine nitrate’ based detonators, ‘oleoresin capsicum’ based teargas grenades and other products as import substitution. Premier has also developed various high energy materials in association with DRDL for use in future guided missile programmes that are soon to be inducted into armed forces.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.