Add Godrej Agrovet, target price Rs 560: ICICI Securities

ICICI Securities has given an add rating to Godrej Agrovet with a target price of Rs 560. The share price moved down by 1.85 per cent from its previous close of Rs 523.70. The stock’s last traded price is Rs 515.

Godrej Agrovet Ltd., incorporated in the year 1991, is a Mid Cap company (having a market cap of Rs 9903.07 Crore) operating in Agriculture/Horticulture/Livestock sector.

Financials
For the quarter ended 30-09-2020, the company reported a Consolidated sales of Rs 1710.90 Crore, up 10.38 % from last quarter Sales of Rs 1550.01 Crore and down -7.37 % from last year same quarter Sales of Rs 1846.97 Crore Company reported net profit after tax of Rs 98.26 Crore in latest quarter.

Investment Rationale
The brokerage expects GAVL to report revenue and PAT CAGRs of 6.9% and 12.3% respectively, over FY20-FY22E. Upgrade to ADD with a DCF based target price of Rs560 (27x FY22E). Key risks: Failure of new products and prolonged slow- down in out-of-home consumption.

Promoter/FII Holdings
Promoters held 70.1 per cent stake in the company as of Sept 30, 2020, while FIIs held 15.3 per cent, DIIs 2 per cent and public and others 12.6 per cent.