Accumulate NOCIL, target price Rs 240: Prabhudas Lilladher

Prabhudas Lilladher has accumulate call on NOCIL with a target price of Rs 240. The current market price of NOCIL is Rs 206.9.

NOCIL, incorporated in the year 1961, is a Small Cap company (having a market cap of Rs 3455.99 Crore) operating in Chemicals sector.

NOCIL key Products/Revenue Segments include Duty Drawback, Other Operating Revenue and Scrap for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 327.93 Crore, down -15.93 % from last quarter Total Income of Rs 390.09 Crore and down -15.79 % from last year same quarter Total Income of Rs 389.40 Crore. Company has reported net profit after tax of Rs 18.62 Crore in latest quarter.

The company’s top management includes Mr.Hrishikesh A Mafatlal, Mr.Priyavrata H Mafatlal, Mr.V S Anand, Mr.Rohit Arora, Mr.P V Bhide, Ms.Dharmishta N Raval, Mr.Debnarayan Bhattacharya, Mr.D N Mungale, Mr.S R Deo, Mr.Vilas R Gupte. Company has Kalyaniwalla & Mistry LLP as its auditors. As on 31-12-2022, the company has a total of 17 Crore shares outstanding.

Investment Rationale
NOCIL remains well placed over medium to long term led by domestic tyre industry capex, China+1 strategy (as customers look for security of supplies), sufficient capacity headroom enabling demand improvement and net cash balance sheet (Rs1.6bn) & healthy FCF generation of Rs.5.5bnover FY23-25E, though increase in supplies by Chinese competition pose risk to volume and spreads.

Promoter/FII Holdings
Promoters held 33.84 per cent stake in the company as of 31-Dec-2022, while FIIs owned 5.29 per cent, DIIs 4.72 per cent.