Add Venus Pipes & Tubes Ltd For Target Rs. 1,830 - Nirmal Bang
Venus is the only pure-play listed player focussed on the high value SS (Stainless Steel) pipe industry.
SS pipes are used in critical, high pressure & temperature applications like pressure vessels, heat exchangers, condensers & others. Industry exposure: Cap Goods 50%, Chemicals 33%, Other industries 17%.
Thus ASP of Stainless Steel pipes is Rs. 4 L/ton, while Carbon Steel is Rs. 70k/ton.
Industry tailwinds (a) BIS certification (b) China discontinued export incentive (c) Anti Dumping Duty
Venus offers strong growth visibility with Sales/PAT CAGR of 50%/78% over FY23–25E, driven by
- − Capacity expansion of 3x from 12k tons to 38k tons by FY25E plus operating leverage thereon
− Backward integration into manufacture of hollow pipes (from SS billets)
− Sales through stockists which is 30% mix today is expected to dip below 20% in favor of direct sales
− Entry in larger diameter pipes: Upto 48” in welded from 8” now; Upto 6” in seamless from 4” now
We assign a TP of Rs. 1,830, valuing the company at 25x Sep 2025E (at 10% discount to target multiple for Ratnamani Metals & Pipes).
Please refer disclaimer at https://www.nirmalbang.com/disclaimer.aspx
SEBI Registration number is INH000001766
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