200% dividend: Balkrishna Industries reports better-than-estimated Q4; stock hits all time high; what should investors do?

Balkrishna Industries share price: Balkrishna Industries shares clocked an all-time high in morning deals on Tuesday (May 21) at Rs 3034.95 apiece on BSE. The buying in the stock came after the company posted better-than-expected Q4 results and numerous brokerages revised their stance on the stock.

At around 9: 48 a.m., shares of the tyre manufacturer gained 7.18 per cent or Rs 201.1 at Rs 3000.05 apiece. The market capitalisation of the company stood at Rs 57,996.12 crore at around the same time.

Brokerage view on Balkrishna  Industries

Nomura upgraded the stock to 'buy' from 'reduce' and raised the target to Rs 3,230 from Rs 2,265 apiece. The brokerage believes strong growth momentum will continue and price hikes will support margins. 

Also, the company is entering a demand upcycle and as global agri prices have started inching up, it should drive replacement demand. Additionally, global peers also expected a recovery in the second half. 
 
Conversely, Morgan Stanley iterated an 'underweight' rating and gave a target of Rs 2,075 apiece. Meanwhile, Citi continued with a 'sell' and gave a target of Rs 2,300 apiece. 

Anil Singhvi's view 

Zee Business Managing Editor Anil Singhvi has recommended buying futures of BalKrishna Industries for targets of Rs 2,850 and Rs 2,890 while keeping a stop loss at Rs 2,770.

How did Balkrishna Industries fare in Q4?

Balkrishna Industries reported an 87.9 per cent increase in standalone profit after tax (PAT) to Rs 481 crore in the March quarter. Zee Business analysts expected the PAT at Rs 320 crore. 

The company had posted a PAT of Rs 256 crore in the same quarter a year ago.

The company's standalone revenue in the quarter under review increased to Rs 2,673 crore from Rs 2318 crore in the same period a year ago. The revenue was estimated at Rs 2,388 crore by the research desk. 

The off-highway tyre manufacturer reported earnings before interest, tax, depreciation, and amortisation (EBITDA) at Rs 665.5 crore against Rs 471.5 crore year-on-year (YoY). The margins for the quarter under review stood at  24.9 per cent against 20.3 per cent. 

Balkrishna Industries dividend 

The board has recommended a final dividend of Rs 4 per equity share (200 per cent) on the equity shares of Rs 2 each (face value) for the year ending March 31, 2024, subject to the approval of the Shareholders of the Company at the ensuing Annual General Meeting.

Balkrishna Industries share price: Past performance 

In a year, shares of Balkrishna Industries have given a return of 22 per cent against Nifty50's rise of over 22 per cent.

Catch all the updates of the May 21 session on Dalal Street here. For all other news related to business, politics, tech and auto, visit Zeebiz.com. 

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