PI Industries Ltd. share price target

We value PIIND at 36x (PE its FY24E EPS) given the strong performance on the export and domestic front and wait for more clarity on ramping up of newly acquired business that could be value accretive for shareholders.

Earning below estimates, but strong show on high base PI Industries (PI)'s operating performance during the quarter was impacted by one-time expenses pertaining to (i) COVID management, (ii) consulting fees, and (iii) other costs related to various strategic projects. Thus, despite...

Gross margins improved 180 bps YoY to ~43.8% while EBITDA margin contracted 80 bps YoY to 20.8%, due to higher employee (up 20% YoY) and other operating cost (up 32% YoY)...

Background: Incorporated in 1947, PI (erstwhile Pesticides India) focuses on agri-input, custom synthesis and polymer compounding with strength of over 1,100 employees. The company currently operates three formulation and two manufacturing facilities as well as five multi-product plants across Gujarat and Jammu, and one R&D; unit in Rajasthan at Udaipur. PI is one of India's leading players in the agri-input industry, primarily dealing in agro-chemicals, specialty fertilizers, plant nutrients and seeds. The company has a strong product portfolio as a result of exclusive tie-ups with leading agro-chemical, pharmaceutical and fine chemical...

CSM business likely to drive overall growth ahead The company launched four molecules last year, while it had around 25 molecules under the CSM portfolio earlier. The order backlog remains at around $ 1.5 billion, of which around 65-70% constitutes long term contracts while the rest are from a short-term contract. Going ahead, there are around 5-6 molecules at various stages of development, which is expected to be commercialised, going ahead. This would expand CSM portfolio and thereby the order backlog. Going ahead, since the new MPP is expected to...

We value PIIND at 40x (PE its FY23E EPS) given the strong performance on the export and domestic front and wait for more clarity on QIP proceeds that could be value accretive for shareholders.

PI Industries manufactures plant protection & specialty plant nutrient products and solutions under its agri-inputs business. It is also one of India's leading custom synthesis (CSM) companies engaged in providing contract...

Background: Incorporated in 1947, PI (erstwhile Pesticides India) focuses on agri-input, custom synthesis and polymer compounding with strength of over 1,100 employees. The company currently operates three formulation and two manufacturing facilities as well as five multi-product plants across Gujarat and Jammu, and one R&D; unit in Rajasthan at Udaipur. PI is one of India's leading players in the agri-input industry, primarily dealing in agro-chemicals, specialty fertilizers, plant nutrients and seeds. The company has a strong product portfolio as a result of exclusive tie-ups with leading agro-chemical, pharmaceutical and fine chemical...

The stock currently trades at 32x at FY23E EPS, which we believe is attractive, and revise our estimates and ratings to BUY (HOLD earlier) with a target price of Rs 2460 (Rs 2169 earlier)

CSM molecules portfolio consists of around 25 molecules currently. The company is in advanced stages for around five to six molecules, which are expected to get commercialised in the next fiscal. This should boost order book growth further in years to come. The order backlog remains at $1.5 billion at present, which provides revenue visibility for the next three years at least. Going ahead, since the new MPP is expected to get commissioned by Q4FY21 along with two new MPPs that are planned to come on board by next fiscal, we expect better execution to lead to strong topline growth in...