Kirloskar Ferrous is a leading player and its business falls under the category of pig iron and castings. In the pig iron business the company supplies to foundries across the country and contributes to Auto, Engines & Compressors, Textile, Pumps, and other manufacturing Industries.
As far as the castings unit is concerned the Grey Iron Castings such as Cylinder Blocks, Cylinder heads & different types of housings required by automotive, construction equipment, agricultural equipment & diesel engine industries.
The company has performed consistently well over the years and has a good track record of paying dividends over the years.
Valuations of Kirloskar Ferrous and why you should buy the stock?
The company has had a good consistent performance over the last few years. For the six months period ending Sept 30, 2021 the company reported revenue of Rs 1781 crores. The net profits for the period was Rs 259.41 crores. The EPS for the 6-months period ending Sept 30, 2021 was Rs 18.66. On a conservative estimate the company can do an EPS of Rs 36 for the full financial year 2021-22. This means the stock is trading even below 6 times at 5.83 price to earnings multiples, which makes the stock of Kirloskar Ferrous attractive to buy. One should accumulate the stock for good dividend yields and capital appreciation.
How the stock has moved?
|52-week low||52-week high||Current market price|
|Rs 138||313||Rs 210|
The stock of Kirloskar Ferrous has fallen significantly from 52-week highs. The stock is now available at just Rs 210, as against the 52-week price of Rs 313. The significant drop in the price has helped to leave valuations at attractive levels and a good dividend yield as well. As economic momentum gathers steam, we believe that Kirloskar Ferrous would be one of the beneficiaries of the economic growth.
Investing in equities is risky and investors must therefore understand the risk. The author and Greynium Information Technologies Pvt Ltd would not be responsible for any losses caused based on the article. The author and is family do not hold shares in any of the above mentioned companies.