Navneet Education zooms 14% on heavy volumes

Since February 1, post December quarter results, the stock rallied 42% against 7% rise in Sensex

Navneet Education zoomed 14% to Rs 175, also its record high on BSE, on back of heavy volumes.

At 1:04 pm; the stock was up 11.5% to Rs 171 as compared to 0.10% rise in the S&P BSE Sensex. The trading volumes on the counter jumped more than 9-fold with a combined 2.6 million shares representing 1.09% of total equity of the company changed hands on BSE and NSE so far.

Since February 1, post December quarter results, the stock rallied 42% against 7% rise in the benchmark index. The company had posted a strong 68% year on year growth in net profit at Rs 12.64 crore in Q3FY17 against Rs 7.53 crore in Q3FY16.

Motilal Oswal Securities has initiated coverage with a buy call and a target price of Rs 210 on the stock.

According to report, the brokerage believes that Navneet Education is well poised to gain market share in the growing CBSE market. Change of syllabus provides strong growth triggers over two years.

In terms of market positioning, it feels that Navneet dominates the market for supplementary educational material and this domineering position makes it a key beneficiary, report suggested.

“Strong management bandwidth with proven track record, high visibility on operating cash-flows, superior return ratios and strong balance sheet, makes Navneet a preferred ‘BUY’ in the Education space,” analysts at domestic brokerage firm said in a recent report.