Buy Sterling Tools at Target of Rs 477
It is observed that the Sterling Tools continues to strengthen its relationship with OEMs.
It is enabling itself to expand product portfolio. Experts believe that the higher grade/ specialised fasteners proportion are on a constant rise. And the margin expansion was the logical outcome.
It is expected that the proportion of specialised fasteners will rise gradually for the foreseeable future.
The analysts also believe that the volatility in raw material prices can impact margins for a couple of quarters as the raw material impact is passed on with a lag. Significant opportunities for STL might get opened by Meidoh tie. Since, the stock has corrected to certain extent, so it can be considered a buying opportunity from a 12 month plus perspective. It is recommended to buy the stock at a target price of Rs 477.