Astral's high growth prospects reflect well in its high valuation

After gaining 40% already in FY24, the stock is trading at a PE of over 100x

PVC pipes, paints and adhesives manufacturer Astral had a strong performance and confident guidance thus far in the 2023-24 financial year (FY24). A good agricultural season, coupled with rebound in housing, means strong demand for pipes. Moreover, PVC prices are down so there could be volume growth and margin expansion.

In the January-March quarter (Q4), pipes saw a volume expansion of 19 per cent quarter-on-quarter (QoQ) while the adhesives division revenue saw 14 per cent QoQ growth.

Earnings before interest, tax, depreciation and amortisation (Ebitda) margins improved across all segments. Sales grew to Rs 1,506 crore, which was up 8