Buy Vinati Organics, target price Rs 2148: Geojit Financial Services

Geojit Financial Services has buy call on Vinati Organics with a target price of Rs 2148. The current market price of Vinati Organics is Rs 1781.7. Time period given by analyst is a year when Vinati Organics price can reach defined target.

Vinati Organics, incorporated in the year 1989, is a Mid Cap company (having a market cap of Rs 18323.47 Crore) operating in Chemicals sector.

Vinati Organics key Products/Revenue Segments include Organic/Inorganic Heavy Chemicals, Scrap and Export Incentives 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 525.47 Crore, down -10.37 % from last quarter Total Income of Rs 586.27 Crore and up 37.00 % from last year same quarter Total Income of Rs 383.55 Crore. Company has reported net profit after tax of Rs 125.41 Crore in latest quarter.

The company’s top management includes Mr.Vinod Banwarilal Saraf, Ms.Vinati Saraf Mutreja, Ms.Mona M Bhide, Dr.(Mrs.)M Lakshmi Kantam, Mr.Adesh Kumar Gupta, Mr.J C Laddha, Ms.Viral Saraf Mittal, Mr.Jayesh Ashar. Company has M M Nissim & Co. LLP as its auditors. As on 31-12-2022, the company has a total of 10 Crore shares outstanding.

Investment Rationale
Synergies owing to backward & forward integration, strong cash flows, healthy balance sheet and ROCE & ROE of above 24% (5yr avg.), instills confidence. The brokerage values the company at a P/E of 30x as it rolls forward to FY25E.

Promoter/FII Holdings
Promoters held 74.06 per cent stake in the company as of 31-Dec-2022, while FIIs owned 4.81 per cent, DIIs 7.88 per cent.