Buy Sharda Cropchem, target price Rs 600: Anand Rathi
Management has guided to 20% volume growth in the coming two years with 20-24% EBITDA margins.
By ETMarkets.com | Updated:
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Anand Rathi has Buy call on Sharda Cropchem with a target price of Rs 600 The current market price of Sharda Cropchem is Rs 525.8.Sharda Cropchem Ltd., incorporated in the year 2004, is a Small Cap company (having a market cap of Rs 4739.73 crore) operating in Pesticides/Agro Chemicals sector.
Financials
For the quarter ended 31-12-2021, the company has reported a Consolidated Total Income of Rs 886.72 crore, up 35.25 % from last quarter Total Income of Rs 655.63 Crore and up 76.10 % from last year same quarter Total Income of Rs 503.54 Crore. Company has reported net profit after tax of Rs 102.20 Crore in latest quarter.
Investment Rationale: The brokerage is positive about Sharda’s future performance, considering its focus on registration, rising share of high margin products and deeper penetration in markets. Further, internally-funded capex and FCF would strengthen its balance sheet. Anand Rathi expects the company's revenue/profit to clock 14%/15% CAGRs over FY22-24.
The stock trades at 12.4x FY22e and 9.4x FY24e earnings. The brokerage maintains Buy rating, though with a revised TP of Rs 600, valuing the stock at 13x FY24e earnings.
Risks: Forex movements, dependence on China for raw material, delay in registrations.
Financials
For the quarter ended 31-12-2021, the company has reported a Consolidated Total Income of Rs 886.72 crore, up 35.25 % from last quarter Total Income of Rs 655.63 Crore and up 76.10 % from last year same quarter Total Income of Rs 503.54 Crore. Company has reported net profit after tax of Rs 102.20 Crore in latest quarter.
Investment Rationale: The brokerage is positive about Sharda’s future performance, considering its focus on registration, rising share of high margin products and deeper penetration in markets. Further, internally-funded capex and FCF would strengthen its balance sheet. Anand Rathi expects the company's revenue/profit to clock 14%/15% CAGRs over FY22-24.
The stock trades at 12.4x FY22e and 9.4x FY24e earnings. The brokerage maintains Buy rating, though with a revised TP of Rs 600, valuing the stock at 13x FY24e earnings.
Risks: Forex movements, dependence on China for raw material, delay in registrations.
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