we expect Cera to expand its EBIT margin from 12.7% in FY18 to 14.7 % in FY21E, which is in reversion to its own 10-year median level. RoCE should improve from 22.7% in FY18 to 26.6% in FY21E. As the company continues to outsource manufacturing, its capex requirement remains limited. We have initiated coverage on the stock with a Buy rating and a target price of Rs 3,483, up 30% from the CMP.
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