Buy Vinati Organics, target price Rs 2740: Motilal Oswal Financial Services

Motilal Oswal Financial Services has buy call on Vinati Organics with a target price of Rs 2740. The current market price of Vinati Organics is Rs 1845.

Vinati Organics, incorporated in the year 1989, is a Mid Cap company (having a market cap of Rs 18963.29 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 30-09-2022, the company has reported a Consolidated Total Income of Rs 586.27 Crore, up 11.67 % from last quarter Total Income of Rs 525.01 Crore and up 51.23 % from last year same quarter Total Income of Rs 387.65 Crore. Company has reported net profit after tax of Rs 116.01 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
ATBS demand outlook remains quite strong going forward in FY24E. Veeral Organics (a wholly owned subsidiary of Vinati Organics) is also set to commence production of MEHQ, Guaiacol, and Iso Amylene in 1HFY24E, which should propel the company into the next leg of its growth story.

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.