Buy Insecticides (India), target price Rs 690: Sharekhan by BNP Paribas

Sharekhan by BNP Paribas has buy call on Insecticides (India) with a target price of Rs 690. The current market price of Insecticides (India) is Rs 575.55.

Insecticides (India), incorporated in the year 1996, is a Small Cap company (having a market cap of Rs 1710.31 Crore) operating in Pesticides/Agro Chemicals sector.

Insecticides (India) key Products/Revenue Segments include Agro Chemicals Intermediates, Other Operating Revenue, Scrap and Job Work 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 356.91 Crore, down -38.73 % from last quarter Total Income of Rs 582.49 Crore and up 13.43 % from last year same quarter Total Income of Rs 314.65 Crore. Company has reported net profit after tax of Rs 9.28 Crore in latest quarter.

The company’s top management includes Mr.Hari Chand Aggarwal, Mr.Rajesh Kumar Aggarwal, Mr.Nikunj Aggarwal, Mr.Virjesh Kumar Gupta, Mr.S Jayaraman, Ms.Praveen Gupta, Mr.Navin Shah. Company has S S Kothari Mehta & Co as its auditors. As on 31-12-2022, the company has a total of 3 Crore shares outstanding.

Investment Rationale
The brokerage expects the company to benefit fromramp-up of new products post capacity expansion and a potential rise in share of branded products(Maharatna brands). Thus, Sharekhan expects strong revenue, EBITDA, and PAT CAGR of 19%/22%/23% overFY2022-FY2025E along with decent RoE of 16%.

At the CMP, the stock is trading at an attractive valuation of 10.9xits FY2024E EPS and 8.5x its FY2025E EPS.et

Promoter/FII Holdings
Promoters held 72.16 per cent stake in the company as of 31-Dec-2022, while FIIs owned 6.27 per cent, DIIs 10.94 per cent.