Accumulate Rallis India; target of Rs 248: Prabhudas Lilladher
Prabhudas Lilladher’s research report on Rallis India
RALI’s growth agenda is on course and has started to bear fruits driven by timely execution of planned strategies. Reversal of fortunes for the domestic agchem industry is also supporting growth. Capacity creation for Metribuzin (phase 2) and the new formulation plant (at Dahej) is on track and will drive growth in FY21 and FY22 coupled with new launches in India, and addition of new channel partners and relaxation of trade policies. We have upgraded our FY20/FY21/FY22 topline estimates by 3.1%/4.4%/5.7% and APAT estimates by 28%/32%/32% largely driven by positive outlook for the domestic industry and commencement of Dahej formulation facility by Q2FY21E.
We roll forward to Mar’22 earnings, maintain our ACCUMULATE rating but increase target price to Rs 248 (Previous- Rs 174) based 17xFY22E earnings of Rs 14.6.
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