CRIN An Integrated Play on Crop Protection ...................................................... 4 Story in Charts ....................................................................................................... 5 Investment Arguments ........................................................................................... 6 Phosphate fertilizer RM prices have bottomed out ............................................. 6 DAP affordability index @ 61 has bottomed out ............................................. 6 Raw material prices have bottomed out globally ............................................ 6 Rock Phosphate prices imitate Phosphoric acid price trend ....................... 7 Recovery in North American agriculture to drive demand ............................ 10...

CRIN saw significant revenue growth of 51% YoY to Rs.3213cr during the quarter as above average monsoon and growth in sowing activities saw large volume offtake. Volumes of key fertilizer products saw large off-take as NitrogenPhosphate-Potassium (NPK) and Di-Ammonium Phosphate (DAP) fertilizers saw an 80% growth in sales volumes. The Crop Protection segment saw its revenues grow by 55% YoY to Rs.420cr as exports and domestic business saw good performance Considering the good monsoon, focus on CPC business and...

We maintain Accumulate on Coromandel International (CRIN) after raising our PE-based target price (TP) by 10.9% to Rs792, following our 21.8%/10.9% upward revision in FY21-22E earnings. CRIN's 1QFY21 PAT came in at Rs2.5bn, a 14.9% miss on our estimate while a tad above consensus expectations. The miss on our estimate was due to CPC segment revenue/EBIT margin coming in 6%/353bps lower and operating costs being 7.1% higher vs. NB estimates. The result looks good on a YoY basis with revenue growth of 50.8%, EBITDA margin expansion of 367bps and PAT growth of 299%. CRIN saw robust YoY growth in revenue/EBIT margin in both Nutrient and CPC segments. This was driven by the massive 77% YoY growth in...

27 July 2020 Coromandel International (CRIN) reported robust performance, led by higher manufacturing volumes (+61% YoY), higher crop protection revenue (off a lower base), and operating leverage. PAT more than quadrupled on higher EBITDA (2.1x YoY), lower tax rate, and lower interest cost. CRIN reported numbers in line with our estimates; thus, we maintain our earnings estimates for FY21/FY22E. Maintain 1QFY21 revenue grew 51% YoY. Overall fertilizer volumes grew 54% YoY on higher manufacturing volumes (+61% YoY) and trading volumes (+25% YoY). Thus, higher manufacturing fertilizer volumes and operating leverage led to a sharp 370bp EBITDA margin expansion to 12.8%. Nutrient and Other Allied segment revenues grew 49% YoY (to INR28.1b), with 240bp EBIT margin expansion (to 13.2%); segmental EBIT grew 83% YoY to INR3.7b. According to our calculations (assuming EBITDA/MT of INR300 for traded fertilizer), EBITDA/MT for manufacturing fertilizer stood at INR4,039/MT (+15% YoY; +8% QoQ) in 1QFY21. Plant Protection revenue grew 55% YoY (to INR4.

Initiating coverage on Coromandel International with a Buy rating, valuing it at 20x FY2022 EPS with a PT of Rs. 1,000 Company among India's top integrated agri solutions provider; significant backward integration drives margins, cashflows and return ratios...

The Company expects the recent ban on pesticides to be overturned, CRIN sells 4 out of the 27 molecules banned With the expectation of a normal monsoon, backward integration and new launches, we expect net profit CAGR of 12% over FY20FY22E...

We maintain our Accumulate rating after raising our PE-based target price (TP) for Coromandel International (CRIN) by 26% to Rs714 (8.24% upside from CMP), following our 31%/26% upward revision in FY21-22E earnings. This is based on the good 4QFY20 results with PAT doubling YoY to Rs2.34bn - a beat of 40%/37% on consensus/NBIE estimates. The positive surprise was driven by the 17% growth in phosphatic sales (volume), 400bps/334bps beat in nutrient/CPC segment EBIT margins and 13.63% beat in CPC revenue, defying our expectation of lower volume/margin and the impact of lockdown in end Mar'20. During the 4QFY20 results concall, the management guided about healthy growth prospects and a favourable kharif crop in the...

27 May 2020 CRINs 4QFY20 revenue grew 9% driven by higher manufacturing volumes (+13% YoY) and lower RM costs (gross margins expanded 520bp to 35%), which in turn led to 51% YoY EBITDA growth. Maintain 4QFY20 revenue grew 9% YoY. Overall fertilizer volumes declined 4% YoY due to trading volumes plummeting 43% YoY. However, 13% YoY growth in manufacturing fertilizer volumes led to sharp 380bp EBITDA margin expansion to 13.6%. Nutrient and other allied segment revenues grew 7% YoY (to INR24.4b) with 400bp EBIT margin expansion (to 12.8%), due to higher manufacturing volumes (segment EBIT grew 56% YoY to INR3.1b). CRIN has contracted phosphoric acid at USD607/MT for 1QFY21 (v/s USD590/MT in 4QFY20). According to our calculations (assuming EBITDA/MT of INR300 for traded fertilizer), EBITDA/MT for manufacturing fertilizer stood at INR3,733/MT (+31% YoY; -3% QoQ) in 4QFY20. Plant protection revenue grew 22% YoY (to INR4.4b) with EBIT margin contracting 50bp (to 13.

We are raising our PE-based TP for Coromandel International (CRIN) by 34.7% to Rs630 (0.11% upside from CMP). This follows our 18.8/22.2/4.7% upward revision in FY20-22E earnings, respectively based on the healthy beat in 3Q results and management's positive comments during the 3Q results call. However, we maintain our Accumulate rating as we believe that the stock's 75% surge from August 19 lows has priced in the management's positive guidance for FY21 based on normal monsoon expectations and offers limited margin of safety in case of any setbacks. Other concerns include the pressure in CPC margins and its relatively higher dependence on technical grades of pesticides, including...

We believe CRIN is one of the best bets in fertilisers space with robust FCF generation and best in-class return profile. We expect it to benefit from a better Rabi season and softening of RM prices in the near-term, while higher level of Backward integration would aid in sustainable margin expansion. The stock has been trading at ~16x of 1-Year forward EPS over the last 3 years and we value it at 15x FY22E EPS. Maintaining our Target Price of Rs606, we revise our...

3 February 2020 3QFY20 revenues grew 8% driven by higher manufacturing volumes (+33% YoY), which in turn led to 42% YoY growth in EBITDA. While revenue was in line during the quarter, beat of 14%/18% in EBITDA/PAT, led to increase in earnings estimates by 9%/8% for FY20/FY21. Revenue grew 8% in 3QFY20 with overall fertilizer volumes growing a mere 6% due to 44% decline in trading volumes; however, 33% growth in manufacturing fertilizer volumes led to a sharp 320bp EBITDA margin expansion to 13.2%. Nutrient and other allied segment revenues grew 8% YoY (to INR28.4b) with 360bp EBIT margin expansion (to 12.8%), due to higher manufacturing volumes. According to our calculations, in 3QFY20, EBITDA/MT for manufacturing fertilizer stood at INR3,845/MT (+16% YoY; - 5% QoQ). Plant protection revenue grew 4% YoY (to INR4.6b) with EBIT margin contraction of 25bp (to 15.4%) on account of softness in mancozeb prices. For 9MFY19, revenue/EBITDA/PAT grew 3%/13%/33% to INR103b/INR13.4b/INR8.

While trading volumes declined 47% YoY, fertilizer manufacturing volumes, which command higher margins, grew 34% YoY. In 2QFY20 too, CRIN witnessed margin expansion of 140bp YoY led by 9% growth in manufacturing fertilizer volumes (despite revenue decline of 3% YoY). Also, CRIN is expected to report record-high absolute 3Q EBITDA of INR3.8b for the Oct-Dec19 quarter, primarily due to (a) higher sales volume due to better acreage in the Rabi season, (b) benign raw material prices, (c) higher share of manufacturing fertilizer, and (d) cost savings on recently commenced phos acid plant. Further, manufacturing of di-ammonium phosphate (DAP) fertilizers surged 5.9x YoY in 3QFY20, while DAP trading declined a steep 86% YoY due to drop in phos acid prices. Acreage dipped marginally in AP by 1%, despite reservoir levels being at 92% of the storage capacity (v/s 48% last year). Acreage increased 30% YoY with reservoir levels of 70% (v/s 30% last year).

years on the back of growth in sales volumes. Government initiatives to double farmer income to drive demand for fertilizer and crop protection products. Direct Benefit Transfer scheme of the central government has eased pressure on the working capital cycle of CRIN....

15 October 2019 According to the Ministry of Fertilizers data, Coromandel Internationals (CRIN) fertilizer manufacturing volumes grew 8% YoY, whereas trading volumes were down 62% YoY in 2QFY20. Manufacturing of di-ammonium phosphate (DAP) fertilizers increased 72% YoY, whereas trading of DAP declined steeply by 88% YoY in 2QFY19 due to a fall in phos acid prices. In the NPK segment, 20-20-0-13 volumes (41% of NPK volumes in FY19) grew 24% YoY, whereas 28-28-0 volumes (accounted for 22%) declined 10% YoY in 2QFY20. In the fertilizer trading segment, Muriate of Potash (MOP) volumes grew steeply by 66% YoY, whereas urea volumes declined 67% YoY in 2QFY20. Andhra Pradesh (AP), Telangana, Maharashtra and Karnataka are the key markets for CRIN these cumulatively accounted for 66% of total fertilizer volumes and 47% of total manufactured fertilizer volumes in FY19 (NPK volumes from the above states form 75% of NPK sales).

Post the 1QFY20 results and the call, we have cut our revenue estimates by 19-21% and earnings estimates by 31% over FY20-FY21E, to factor in the weak 1QFY20 numbers and tempered expectations for the CPC business in FY20E. We are downgrading the stock from Accumulate to...

During the quarter, plant protection revenue declined 36% YoY to INR2,710m, with the EBIT margin shrinking 10pp YoY to 2.2%, primarily on account of the shutdown at the Sarigam plant (revenue/EBITDA impact of INR700-800m/INR400-450m) and the softness in mancozeb prices. Additionally, EBITDA/mt for the fertilizer segment stood at INR2,979 up 49% YoY owing to forex gain (INR300m) and lower RM cost. (i) MRP across fertilizers declined by 8-10% owing to a decrease in RM cost. (ii) Company guided for 8-12% revenue growth in FY20, with EBITDA margin of 14-15% in the plant protection business. We cut our earnings estimate by 6%/7% for FY20/21, mainly on account (a) a cut in the EBITDA estimate for the crop protection business by 12%/6.5% for FY20/21 and (b) an increase in depreciation and interest cost. Maintain Coromandel International Crop protection revenue declined 36% YoY to INR2.7b, while nutrient & other allied business revenue was down 12% YoY to INR18.8b.

Coromandel International's management sounded cautiously optimistic about the company's long-term growth prospects and likely easing of working capital pressure on the nutrient business. The company is banking on the backward integration project in nutrients and new launches in crop protection chemicals across technical grades as well as formulations to support its future growth outlook. Post FY19 numbers, we have marginally trimmed our estimates to factor in the subdued near-term prospects for CPC business as per the management's guidance. We have retained Accumulate rating on...

We expect margin pressure to subside in FY20, due to backward integration in phosphoric acid, coupled with lower RM prices. We expect the non-subsidy business to grow (estimate a 20% CAGR in the crop protection business over FY20-21E to ` 25.0bn). The company expects the plant in Sarigam, which is currently shut, to become operational in 1HFY20. The Dahej plant, which manufactures Mancozeb, has become operational and is likely to lead to volume growth in the crop protection business. The stock is currently available at 15.4x and 13.6x FY20E and FY21E EPS. We...

YoY to 9.8% (our estimate: 6.7%). Consequently, adj. PAT grew 26% YoY to INR1,129m (our estimate: INR864m). FY19 performance: Revenue grew 19.3% YoY to INR132.3b, while the margin shrank 40bp YoY to 10.9%. Adj. PAT grew 6.5% YoY to INR7,362m. RM prices softening but expect working capital pressure: CRIN has contracted phos acid at USD728/mt for 1QFY20 (v/s USD750/mt in 4QFY19), indicating stability in RM prices. However, we expect continued working capital pressure owing to delayed subsidy disbursal. The company received...

Coromandel International (CRIN) is the largest privately-owned phosphatic fertiliser company in India. On all-India basis, it has a 16% market share while in its home markets of Andhra Pradesh, Telangana and other adjacent states it holds nearly 65% share. The phosphatic fertiliser category has two sub-divisions viz. NPK or complex (nitrogen, phosphorus and potassium) and DAP (di-ammonium phosphate). Urea comes under a separate nitrogenous fertiliser category. The fertiliser sector is not loved by many investors because of high government intervention (a fair reason considering the fate of many fertiliser companies in the past). However, we like to point out that CRIN has...