Anand Rathi in a researsh Note is Bullish on the Prospects of Alok Industries,
Alok Industries is one of the largest & fully integrated textile manufacturers in the country, with widest product portfolio [from Cotton & Polyester yarn, grey, Fabric, Home textiles, Apparel fabric, to Garments] catering to host of segments. It mainly caters to domestic markets [65%] while rest is exported. Company's main focus is on value added products and retail [it is expanding its retail H&A outlet network to 1000 in 2 years].
The order book is full for next 4 months at Rs 900crs including Home textiles order book which is full for the whole year. This offers revenue visibility for the second half of this FY.
The industry outlook is good and is expected to improve further as after de-stocking of last year, most of the big global retailers are placing fresh orders in big way.
Management is making efforts to improve the margins in domestic as well as global sales and volumes are growing, so cash generation will take care of high debt which will come down gradually. With cash EPS for current year, close to 10/-and EPS around Rs 4/-, we expect this highly liquid stock to reach levels of 30-35 in next 6-12 months.
