Incorporated in 1986, Century Plyboards India Ltd (CPIL) is the largest domestic player in the plywood and decorative veneers space in the organized plywood market, catering to both residential as well as commercial consumers.
Outlook and Valuation: CPIL’s diversified business model along with strong brand recall and change in business mix towards high margin MDF and continuous focus on expanding its portfolio will drive growth going ahead. Consequently, we estimate consolidated revenue/PAT to grow at a CAGR of 15%/16% over FY17-20E. The stock currently trades at ~36x/32x/28x FY18E/19E/20E EPS. We value the stock at 28x FY20E EPS arriving at a target price (TP) of Rs. 369.
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