India’s household appliances industry is rapidly expanding, driven by rising incomes and urbanization. Valued at $10.93 billion in 2022, it’s expected to grow at a CAGR of 9.5%, reaching $21.18 billion by 2028. Key segments include kitchen appliances, air conditioners, refrigerators, and washing machines.
With a market capitalization of Rs 3,045.06 crore, the shares of Stove Kraft Ltd were trading at Rs 921.30 per share, decreasing around 0.29 percent as compared to the previous closing price of Rs 923.95 apiece.
Brokerage Recommendations:-
Emkay Global Financial Services, one of the well-known brokerages in India, gave a ‘Buy’ call on the stock with a target price of Rs 1,350, indicating a potential upside of 46 percent from Wednesday’s price of Rs 921.30 per share.
Target Rational:-
According to Emkay Global, Stove Kraft valuations are favorable due to substantial market share increases at a 35% EPS CAGR and solid free cash flows. Furthermore, the brokerage believes that the company’s distribution growth has improved, incorporating new channels such as e-commerce and modern retail.
Additionally, Stove Kraft has sharply outperformed peers 15 percentage points revenue share gains over FY16-24, driven by improvement in categories like non-stick cookware, pressure cookers, and other small appliance. The company has also emerged as the market leader in products like induction cooktops, air fryers, and electric kettles despite being only a recent entrant here.
Ace investor Ashish Kacholia holds 5,76,916 shares, i.e. equivalent to 1.75 percent of the company as of June 2024.
Remarkable Return:-
The stock has given a multi-bagger return of 100 percent in just six months and a 72.35 percent return in a year, A shareholder’s investment of Rs. 1 lakh in the firm is worth Rs. 2 lakh in just six months.
Financial performance:-
Looking forward the company’s financial condition, revenue ramped up by 5.6 percent from Rs 297.75 crore in Q1FY24 to Rs 314.45 crore in Q1FY25, during the same time frame net profit stood stable at Rs 8.20 crore last year same period.
Ratio analysis:-
The company’s critical ratios show that the return on equity declined from 8.86 percent in FY22-23 to 7.77 percent in FY23-24, while the return on capital employed declined from 13.31 percent to 12.27 percent. The net profit margin (NPM) for fiscal year 23-24 is 2.50 percent.
Company Profile:-
Stove Kraft Limited is engaged in the manufacture and retail of a suite of kitchen and home solutions under the brand names Pigeon, Gilma, and BLACK+DECKER. The Company operates through the Kitchen and Home Appliances segment.
Written by:- Abhishek Singh
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