After a mixed performance from the speciality chemical companies over the last couple of quarters, domestic brokerage firms see a decent recovery for some in the June 2022 quarter, including two new debutants.
Brokerages believe that specialty chemical companies will report an expansion of margins on a sequential basis, along with a strong order pipeline and decent growth potential over coming years.
In its preview report,
said that specialty chemical firms’ revenue is set to grow at 18 per cent YoY (2.2 per cent QoQ) in Q1FY23, partly on a rise in prices due to input cost inflation.
Gross profit will likely grow 20 per cent YoY (+2.3 per cent QoQ), which indicates a strong underlying trend, said ICICI Securities. It further expects sequential EBITDA margin improvement, and
and are its top picks from the sector.
Brokerage KR Choksey has initiated coverage on Anupam Rasayan with a buy recommendation and a target price of Rs 780 on the counter, based on the company’s robust earnings growth and strong order pipeline.
The brokerage believes that a healthy order book and new product pipeline would boost the company’s topline. “Margin expansion is possible over cost reduction, while organic and inorganic routes will pave way for business growth,” it added.
Gujarat-based Anupam Rasayan was incorporated in 2003 and got listed in March 2021. It manufactures various molecules used in agriculture, pharmaceutical, personal care, speciality dyes and and polymer industries.
Meanwhile, brokerage
Securities has given Aether Industries, the latest debutant of Dalal street, a buy tag with a target price of Rs 1,045. The company is seen more than doubling its manufacturing capacity by CY23 end, the brokerage said.
“Augmentation of capacity will not only allow it to fulfil the demand of the existing and potential customers for existing products, but also provide an opportunity to launch new products,” it added.
Aether’s business model compels it to regularly launch products and add competencies, HDFC Securities said, adding that the company is tripling its research and development (R&D) infrastructure and strengthening its team size.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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