Neutral on Navin Fluorine, target price Rs 4040: Motilal Oswal

Motilal Oswal has neutral call on Navin Fluorine International with a target price of Rs 4040. The current market price of Navin Fluorine is Rs 3654.55. Time period given by analyst is one year when Navin Fluorine International price can reach defined target.

Navin Fluorine International Ltd., incorporated in the year 1998, is a Mid Cap company (having a market cap of Rs 18225.10 Crore) operating in Chemicals sector.

Financials
For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 335.39 Crore, down -6.77 % from last quarter Total Income of Rs 359.73 Crore and up 33.55 % from last year same quarter Total Income of Rs 251.13 Crore. Company reported net profit after tax of Rs 55.92 Crore in latest quarter.


Investment Rationale
The stock is trading at 36x FY23E EPS of INR96 and 27x FY23E EV/EBITDA, with expected improvement in return ratios to ~23% (+600bps v/s FY21) – despite huge capex (INR7.3b over the next three years).

Promoter/FII Holdings
Promoters held 30.2 per cent stake in the company as of June 30, 2021, while FIIs held 26.7 per cent, DIIs 15.2 per cent and public and others 28 per cent.