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Shares of consumer durable companies, including household appliance manufacturers, witnessed sharp rally on Tuesday. The S&P BSE Consumer Durables index surged as much as 2.23 per cent during the trade.
Among individual stocks, Butterfly Gandhimathi Appliances zoomed 15 per cent to Rs 157.90 on the BSE during the day. At 01:15 PM, the stock was trading 12 per cent higher at Rs 153.85. In comparison, the benchmark S&P BSE Sensex was ruling 0.64 per cent higher at 38,293.77 levels.
Other stocks that were trading with decent gains included Crompton Greaves Consumer Electricals (up over 4 per cent), Voltas (up over 2 per cent), VIP Industries (up 3 per cent), and Blue Star (up nearly 2 per cent).
For the quarter ended June 2020 (Q1FY21), Butterfly Gandhimathi reported a net loss of Rs 8.61 crore as against the net profit of Rs 2.19 crore in the corresponding quarter of the previous fiscal. Sales declined 49.53 per cent to Rs 76.76 crore during the period as against Rs 152.08 crore in the year-ago period. READ MORE
In its June 15 report, ICICI Securities had maintained a "HOLD" rating on the stock with the target price of Rs 130. The performance during the festive period would be critical for revenues to gain momentum, the brokerage had said.
"We model revenue de-growth of 18 per cent in FY21 and growth of 22 per cent in FY22. We expect a gradual improvement in margin profile and expect EBITDA margins to recover to 7 per cent in FY22. However, this continues to be lower compared to its peers (EBITDA margin: 13-15 per cent). The key monitorable would be revenue recovery, sustaining the growth, and managing the working capital. We value the company on EV/sales and assign a multiple of 0.5x," it added.
