UBS initiates Kajaria Ceramics with 'buy'

Reuters Market Eye - Ceramics and tiles maker Kajaria Ceramics Ltd gains 0.95 percent to 250.85 rupees after UBS initiated coverage on the stock with a "buy" rating and a 12-month target price of 325 rupees.

UBS said it expects India's tile market to grow 13-14 percent annually led by growing urbanisation, higher housing demand and an increased awareness about hygiene.

The investment bank says Kajaria is a "well-established" brand of ceramic, with "strong" revenue growth and better operating margins than its rivals.

"Kajaria should benefit from consumers trading up due to rising income levels, which is likely to shift demand towards branded products," UBS said.

 

(Reporting by Himank Sharma)