Buy Tata Chemicals, target price Rs 1370: ICICI Direct

ICICI Direct has buy call on Tata Chemicals with a target price of Rs 1370. The current market price of Tata Chemicals is Rs 1146.95. Time period given by analyst is one year when Tata Chemicals Ltd. price can reach defined target.

Tata Chemicals Ltd., incorporated in the year 1939, is a Mid Cap company (having a market cap of Rs 29572.11 Crore) operating in Chemicals sector.

Tata Chemicals Ltd. key Products/Revenue Segments include Salt, Others, Refined Sodium Bicarbonate and Specialty Chemicals for the year ending 31-Mar-2022.



Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 4041.00 Crore, up 12.66 % from last quarter Total Income of Rs 3586.91 Crore and up 33.30 % from last year same quarter Total Income of Rs 3031.53 Crore. Company reported net profit after tax of Rs 608.00 Crore in latest quarter.

Investment Rationale
Since there has been a revival in construction activity across the globe, the brokerage expects flat glass demand to also have improved and thereby the demand for soda ash. It expects the export business for North America unit to have performed well and, thus, should have given respite to the overall performance. Apart from this, better realisation should also have aided overall growth for the quarter. The revenue is expected to grow 36.7% YoY to Rs 4133 crore. OPM can likely remain at 22.9% (637 bps YoY) resulting in EBITDA growth of 89.3% YoY to Rs 948 crore. PAT is expected to remain at Rs 483 crore (up 130.8% YoY). Key Monitorable : Growth in the basic chemical across key geographies along with EBITDA/tonne

Promoter/FII Holdings
Promoters held 37.98 per cent stake in the company as of 30-Jun-2022, while FIIs owned 14.99 per cent, DIIs 19.14 per cent.