Deepak Nitrite Ltd. share price target

Strong quarter; commentary on capex encouraging

Though Deepak Nitrite's (DEN) Q1FY21 performance was impacted by the novel coronavirus.

Deepak Nitrite (DEN) posted another strong performance in Q4FY20. Impact from COVID-19 led nationwide lockdown was counterbalanced by consistent margin profiles across business segments.

Dazzled by all but miraculous showing of DNL's barely pretentious performance products business in last few quarters, DNL's consolidated PBT surged by all but astonishing 377.6% in the first nine months of FY20 compared to that in the same period a year ago. Thanks to pinched supply of DASDA globally, DNL's performance products business EBIT leapfrogged nearly tenfold in the reported period, though sales advanced by a miserly 2x. Yet margins of performance products have moderated in last few quarters, declining to 54.1% in Q3 from 58.1% in Q1, with further...

Deepak Nitrite Ltd (DEN) posted solid Q3FY20 performance as the results for all the three segments in their base business remained strong.

Hurt by planned shutdown of the phenol for two weeks coupled with moderation in global phenol prices, DNL's phenolics business posted over 13% drop in revenues last quarter, while crack spreads continued its moderation not least due to slowdown in global economic growth and subdued activity in Indian real estate and automobile sectors. EBIT margin as a consequence slid to 5.6% in Q2 compared to 11.8% in the preceding...

Deepak Nitrite's (DEN) base business continued on its robust growth momentum in Q2FY20, particularly driven by the stellar performance of the Performance Products (PP) segment.

Deepak Nitrite (DEN) recorded impressive growth during the quarter with 127% y-o-y and 4% sequential increase in revenues to INR 1,051 crore, ahead of our estimates by 3%.

We initiate coverage on Deepak Nitrite Ltd as a BUY with a price

Deepak Nitrite (DEN) recorded impressive growth during the quarter driven by its Performance Products and Basic Chemicals businesses