We at GEPL have been repeatedly recommending Asahi India Glass Ltd from the levels of Rs.65 with a current target price is Rs.150.
Asahi India Glass Ltd, a glass processing company, is jointly promoted by the Labroo family, Asahi Glass and Maruti Suzuki. The glass processing industry is growing at a rapid pace with an average growth rate of 20% in the past few years. Asahi India entered this industry in 2004 and today garners a market share of about 29% and is also the largest supplier of auto glass in India with 75-80% market share. The company recently commissioned its largest integrated plant in Roorkee, which has given it the scale, size and scope to improve its operational efficiency. With this, Asahi India has moved up the value chain from being a first generation auto glass manufacturer to fully integrated glass solutions provider becoming a preferred vendor with various international OEM manufacturers growing in India.
Although the years 2007 to 2009 was a challenging period due to rising input costs, Asahi India took necessary steps to counter these challenges and emerged as an end-to-end glass player. The company now expects to reap the benefits of its investments made raising our expectations on its future performance.
Hence we strongly recommend this stock at the current levels with a 1 year forward target price of Rs.150.