Target Price : ₹575
CMP : ₹437.65
Epack Durable is a proxy play in the rapidly growing Room Air Conditioners (RAC) segment. Since its founding in 2019, Epack has seen remarkable growth, with its revenue increasing by CAGR of 24 per cent between FY22 and FY24. The company has built strong, long-term relationships with its clients, with some partnerships lasting over 8 years.
The company is strategically broadening its product offerings beyond RACs to include air coolers, top load washing machines and air fryers, with additional small kitchen appliances in development.
This diversification positions Epack well to capture growth in related markets. The RAC sector is projected to expand significantly, with forecasts suggesting a rise to about 25 million units in FY29E, reflecting a robust 18 per cent CAGR growth in the industry. Epack’s strong backward integration capabilities and advanced R&D infrastructure are expected to drive its success in this competitive market.
We expect our sales/EBITDA/PAT to growth at a CAGR of 31/34/55 per cent over FY24 to FY27.
Currently trading at 29x on its projected earnings for the FY27E, Epack presents an attractive investment opportunity considering its promising growth trajectory and positive outlook. We recommend a Buy rating with a target price of ₹575 valuing at 40x FY27E EPS.