Sharekhan is bullish on Grasim Industries has recommended buy rating on the stock with a target price of Rs 1880 in its research report dated September 17, 2021.
Broker Research
September 20, 2021 / 01:07 PM IST
“India’s specialty chemicals industry is a decadal growth opportunity and it is still not too late to participate in the value creation process. We prefer CRAMS/CSM players Navin Fluorine (Navin) and PI Industries (PI) as they provide long-term earnings visibility. We also like UPL due to robust growth outlook and reducing debt concerns and SRF due to rising contribution from the chemicals business,” JM Financial research report.
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Sharekhan’s research report on Grasim Industries
Grasim stands to benefit from government’s relief package to telecom sector as Vodafone Idea avoids bankruptcy and gets fairly longer period to better manage cash flows. Grasim’s chemicals business is slated to benefit from rising caustic soda prices which have been on an uptrend with caustic soda flakes and lye prices rising 6% q-o-q and 17% q-o-q respectively during Q2FY2022 till date. VSF prices have been treading lower since March 2021 while spreads with cotton have risen to historic highs, which may drive up VSF prices as demand picks up.
Outlook
We retain a Buy on Grasim with a revised PT of Rs. 1880 reducing holding company discount for its listed entities in financial services and telecom.
For all recommendations report, click here
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