Flash News Investment - - RECOMMENDATIONS -

We had rec­om­mended GNFC in vol­ume no. 33, is­sue no. 26 (dated April 17, 2017) when the scrip was trad­ing at Rs 286. Our rec­om­men­da­tion was backed by fac­tors such as its good fi­nan­cial per­for­mance in H1FY17. The com­pany’s turnover stood at Rs 1,054 crore for Q1FY18, as against Rs 963 crore in Q1FY17, while the net profit stood at Rs 205 crore, as against Rs 169 crore in Q1FY17. Go­ing for­ward, the com­pany is ex­pected to gain fur­ther in FY18, if the Cen­tre im­poses anti-dump­ing duty on toluene di-iso­cyanate (TDI) which would re­strict im­ports from China, Korea and Ja­pan, mak­ing GNFC the largest TDI player. It also aims to be­come debt-free by the end of FY18. We ex­pect the com­pany to show strong per­for­mance in FY18 and hence rec­om­mend our in­vestors to HOLD the scrip.

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