Citi upgrades Pidilite to a 'buy' after stock corrects 25% from highs
CitiGroup has upgraded the Pidilite stock to a ‘buy’ rating from a ‘neutral’ rating cutting the target price to Rs 2,440 from Rs 3,110.
Adhesives manufacturing giant Pidilite has been given a thumbs up by a recent CitiGroup report. The brokerage house has upgraded the stock to a ‘buy’ rating from a ‘neutral’ one, cutting the target price to Rs 2,440 from Rs 3,110.
CitiGroup house believes the risk-reward is favourable after the stock corrected 25 percent from its recent peak.
The stock managed to trade flat in the past month when the market had been going through a tough time.
While the operating environment would be volatile, Citi believes Pidilite has a better chance than smaller and regional players in terms of margin as customers would prefer trusted brands.
Pidilite has recovered more than 3% in June 13 morning trade on the positive brokerage report.The report says that the company displayed strong pricing power in the past and could, therefore, quickly recover margin.
In fact, Pidilite, in the past, has increased prices and now the margin recovery could be faster for Pidilite if the input price starts correcting.
To watch Nimesh Shah's other stock analysis based on important brokerage reports, click on the Standout Brokerage Report tab below.
(Edited by : Abhishek Jha)
First Published: Jun 13, 2022 10:25 AM IST
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