NOCIL Ltd. share price target

Nocil reported steady Q3FY19 numbers in challenging business environment Domestic automobile growth has witnessed muted growth during 9MFY19 largely on account of extreme swings in crude oil prices, higher upfront costs to customers due to change in regulatory measures relating to insurance and the recent NBFC liquidity woes. On the global front, automobile demand scenario was even more grave as the largest auto market China registered ~3% YoY de-growth in 2018 mainly triggered by the increasing trade war tensions with the US. Despite all these challenges Nocil has recorded a steady quarter with net sales coming in at `261.2 crore (up 4.2% YoY, down 4.0%...

We cut our FY20/21E earnings estimates by ~6% to factor in weakness in global tyre market as we moderate our volume growth assumptions. However, Nocil with capacities doubling by H2FY20E is well poised to benefit from tight demand-supply situation in global rubber chemicals market. High global tyre capex along with increased domestic capex augurs well for Nocil, even though near term weakness in domestic and global auto sales will be a drag. Nocil has recently started exporting to US in a limited way as tyre players look to diversify supplies on the back of rising US. Reiterate BUY with...

Way2Wealth Brokers Pvt. Ltd. (CIN U67120KA2000PTC027628) SEBI Rgn. No. : INH200002739 No. 14, Frontline Granduer, Walton Road, Bangalore-560001; Website: www.way2wealth.com Email: research@way2wealth.com...

history of over four decades, Nocil owns a lions share of 50% in the domestic rubber chemicals market and ~5% globally. A wide product range, global presence, technical know-how and a reputation of being a dependable supplier have ensured market share expansion not only at home but also globally. Growth in rubber chemicals is highly dependent on demand from the tyre industry the largest consumer of rubber chemicals (~65%). According to the company, the global tyre industry has committed ~USD7.5b toward expansion plans, while the Indian tyre companies have lined up capex to the tune of INR-150-180b over the next few years. This is likely to drive tyre industry growth of 12-14% over the next 4-5 years, benefiting rubber chemicals behemoths like Nocil. To capitalize on the growth opportunities amid favorable market conditions, Nocil has earmarked capex of INR4.25b at its Navi Mumbai and Dahej plants.

BUY Nocil Ltd CMP at Rs. 81 and add on dips to Rs. 74-76 for the Sequential Targets for the Rs. 91.25 & Rs. 98

NOCIL was incorporated in 1961 as National Organic Chemical Industries Ltd. NOCIL is into manufacturing and trading basic organic chemicals. The Company offers products, such as accelerators under the name PILCURE; antidegradants, such as PILFLEX 13; antioxidants, under the name PILNOX; pre vulcanization inhibitor, such as PILGARD PVI, and post vulcanization stabilizer, such as PILCURE DHTS. Domestic sales accounted for 70% of revenue in FY16 and the balance is from exports. NOCIL has a installed capacity of 55,000 tonnes (including Dahej of 15,000 tonnes). The company has manufacturing...

NOCIL is involved in the Rubber chemicals business from last 4 decades. Company offers wide range of rubber chemicals to suit to their customer needs. Being rich in Experience Company offers a one stop shop to customers, NOCIL is today acknowledged as a dependable supplier of rubber chemicals. They have Global recognition for their technical capabilities and on this aspect alone, NOCIL enjoys an edge over other players in this business....

1975. The company manufactures all chemicals used in rubber processing viz. chemical acceleratorsandantioxidants,andleadsmarketshareinIndia(byvolumes).Itoperatestwo manufacturingfacilities(ThaneandDahej)andhasacombinedcapacityof53,500MT.The...

NOCIL is the largest rubber chemicals manufacturer in India with a total capacity of 55,000 tones (including Dahej 15,000 tones) with current capacity utilization of 80%. Their manufacturing facilities are located at Navi Mumbai and Dahej. Major customers of the...