amankavi
Long

Sterlite - 5g empowered - Strong outlook

NSE:STRTECH   STERLITE TECH LTD
Scrip can be seen showing sign of corrections with MACD short term average going down below long term and price action coming below short-term EMA although dragonfly doji has formed on weekly charts so there could be some retracement however, the scrip is very much worthy of accumulating on dips. As of now, It is trading at expensive valuation with P/E - 35.08

Expecting the price down at around 250 and then enter upon confirmation aiming for 52-week high and above as the company has strong macro outlook with very balanced geographical split to revenues with both exports and domestic business contributing equally to the top line and equally strong future outlook.

Noticing the current price action, The scrip could be pulled back. Would plan to buy on dips near support levels aiming for long term investment purposes as mentioned inc hart.

Pros:
1) Strong order book at all time high
2) Stellar Q4 results posted with drastic increase in YoY PAT, EBIDTA margins, RoCE and decrease in debt to equity:
https://telecom.economictimes.indiatimes...
3) Dividend paying company
4) Press release with financial results squarely emphasizes on the growth outlook with company showing stellar performance:
https://www.bseindia.com/xml-data/corpfi...
5) Second largest company in Cable sector

Cons:
1) P/E on higher side: 35.08
2) Price to book value: 10.27
3) Borrowings increased however debt to equity is on lower side and there is adequate Interest Coverage: ₹ 5.79. Nothing much to worry as company is going on Capex mode with expanding of greenfield fiber capacity. Moreover, RoCE on higher side ensures that company is showing increased efficiency by generating higher profit on increased capital

Technical factors given in chart..
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