Buy PI Industries, target price Rs 4200: Sharekhan by BNP Paribas

Sharekhan by BNP Paribas has buy call on PI Industries with a target price of Rs 4200. The current market price of PI Industries is Rs 3398.

PI Industries, incorporated in the year 1946, is a Large Cap company (having a market cap of Rs 51568.99 Crore) operating in Pesticides/Agro Chemicals sector.

PI Industries key Products/Revenue Segments include Agri inputs, Export Incentives, Sale of services and Scrap for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-03-2023, the company has reported a Consolidated Total Income of Rs 1615.10 Crore, down -2.90 % from last quarter Total Income of Rs 1663.40 Crore and up 14.13 % from last year same quarter Total Income of Rs 1415.20 Crore. Company has reported net profit after tax of Rs 279.40 Crore in latest quarter.

The company’s top management includes Mr.Shobinder Duggal, Dr.T S Balganesh, Ms.Lisa J Brown, Mrs.Ramni Nirula, Mr.Pravin K Laheri, Mr.Arvind Singhal, Mr.Rajnish Sarna, Ms.Pia Singh, Mr.Mayank Singhal, Mr.Narayan K Seshadri, Mr.Salil Singhal. Company has Price Waterhouse Chartered Accountants LLP as its auditors. As on 31-03-2023, the company has a total of 15 Crore shares outstanding.

Investment Rationale
PI’s pharma foray would diversify its earnings stream and drive medium to long-term growth for the company. Even after recent acquisitions, PI would has a strong net cash position of Rs. 2,304 crores to pursue both organic and inorganic growth opportunities.

The brokerage expects PI’s revenue/EBITDA/PAT to post a strong CAGR of 20%/19%/19% over FY2023-FY2025E, led by robust CSM order book of $1.8 billion and ramp-up of nine new products commercialised in the last one year. Growth would further improve post integration of TRM and Archimica’s acquisition.

Promoter/FII Holdings
Promoters held 46.09 per cent stake in the company as of 31-Mar-2023, while FIIs owned 18.59 per cent, DIIs 24.06 per cent.