Citi Research forecasts a return to mid-single-digit growth for India's plastic pipes industry, driven by sustained demand from housing, irrigation, and replacement cycles, according to a report by analyst Tejas Pradhan.

Within this positive sector outlook, Citi expresses a clear preference for Astral Ltd. over Supreme Industries. The bank highlights Astral's growth levers, including expansion into new geographies and stronger growth prospects for its non-pipes business (such as adhesives and coatings).

Initiation of Coverage and Ratings:

• Astral Ltd.: Initiated with a "Buy" rating and a 12-month target price of INR 1,800. This implies a potential upside of approximately 29% from its last traded price of INR 1,390.20.
• Supreme Industries: Initiated with a "Sell" rating and a target price of INR 2,950. This suggests a potential downside of about 7.5% from its last quoted price of INR 3,191.00.

Investment Thesis:
Citi's call hinges on a selective approach within the sector. While anticipating a broad industry recovery, the bank believes Astral is better positioned to capitalize on the growth trend due to its diversified business model and geographic expansion strategy, warranting a premium valuation over its peer.