Nalanda Securities is bullish on United Phosphorus has recommended buy rating on the stock with a target price of Rs 778 in its research report dated October 29, 2018.
Nalanda Securities' research report on United Phosphorus
LATAM revenues increased from INR 1385 crore in Q2 FY18 to INR 1742 crore in Q2 FY19. LATAM contributed 41% to it’s Q2 FY19 revenues. All key countries in Latam, with the exception of Argentina, registered strong growth in the quarter. In Argentina the focus is to improve quality of business. Strong campaign in South Cone to drive UPL’s leadership in fungicide resistance management in soybean.
Outlook
At CMP of INR 622.7, the company is trading at 11.7x FY20E EPS of 53.4 and EV/EBITDA multiple of 7.9. We value the company using average of P/E and EV/EBITDA methodology giving an exit multiple of 14 and 10 respectively on FY 20 basis, achieving a target price of INR 778, upside of 25%.
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