UBS has started coverage on Eureka Forbes, the maker of Aquaguard water purifiers, with a buy recommendation. The brokerage highlights the company's under-appreciated scale in water purifiers and services. It sets a target price of Rs 640, driven by growing health awareness and consumer base.
Eureka Forbes, known for its Aquaguard brand, has caught the attention of UBS analysts. The Swiss bank initiated coverage on the consumer durables company with a 'Buy' rating, describing it as a 'steady earnings compounder'. This assessment points to the firm's strong position in the water purifier market, where it benefits from scale advantages that the market has not fully recognized.
The target price of Rs 640 reflects UBS's optimism about the sector's growth. Factors include rising health awareness among consumers and an expanding base of potential buyers in India. These trends are expected to boost demand for water purification products and related services.
Eureka Forbes operates in the broader consumer durables sector, which also encompasses air purifiers and vacuum cleaners. UBS's note emphasizes the company's ability to compound earnings steadily, suggesting sustained performance amid market expansion. The brokerage's analysis underscores how these elements position Eureka Forbes for upside potential in stock value.
This coverage comes as investors seek opportunities in steady-growth stocks within consumer essentials. UBS's recommendation provides a clear signal on the company's undervalued strengths in a vital home appliance category.
