Below are the price targets for Britannia Industries Ltd. (BRITANNIA.BO) over the next 10 years.
Our price targets for Britannia Industries Ltd. (BRITANNIA.BO) for the remainder of 2020 are:
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6,440.00 (overvalued)
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4,672.50 (fair value)
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2,905.00 (undervalued)
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1,925.00 (extreme undervalue)
The valuation targets for Britannia Industries Ltd. (BRITANNIA.BO) are based on a dividend growth rate of 10% which is derived from one half the average dividend growth from 2000 to 2019 and applied to Edson Gould’s Altimeter. A graphical representation of the overvalued, fair value, and undervalued levels are below.
The above Altimeter translates into the following undervalued and overvalued ranges since 2000:
Yield Range
10-Year Price Targets
Observations
The nature of dividend growth rates for any stock is to decline over time. That is why we have cut the growth rate from 20% to 10%.
Having said this, Britannia Industries has recently increased the dividend dramatically in 2020 versus 2019. The primary concern is whether such a growth rate is sustainable. We’ve opted for the most cautious view and would only consider a position (preceded by due diligence) at or below the Undervalued level or a dividend yield of 4.80% or higher.
see also:
- ITC Limited Probability Data
- Hindustan Unilever Limited 10-Year Targets
- Work Smart, Not Hard (The Power of Compounding)
- More 10-Year Targets