Multibagger chemical stock down 16% in 2022 so far. Analysts say 'Buy' after Q3 results
Premium- JM Financial has a Buy rating on the multibagger chemical stock, however, has lowered its target price
PI Industries’ sales in the third quarter was ahead of estimates despite adverse weather conditions in the domestic market as the CSM business continued to perform well. The improvement in gross margin suggests that the company was able to pass on the higher input costs in both domestic and export segments, said JM Financial in a note post the company’s Q3 results.
“PI Industries’ focus on diversification away from agrochemicals is visible in its efforts to manufacture electronic chemicals along with other fine/specialty chemicals. While we do agree that its pharma acquisition is pending for more than a year, we draw comfort from its CSM business, which continues to provide a stable and robust growth outlook," the brokerage said while maintaining its Buy rating on the multibagger stock with target price ₹3,620 (from ₹3,675 earlier).
PI Industries’ focus on diversification away from agrochemicals is visible in its efforts to manufacture electronic chemicals along with other fine/specialty chemicals, said analysts at domestic brokerage and research firm JM Financial.
“Although there is still no clarity on the pharma acquisition, the brokerage draws comfort from its CSM business, which, with a robust order book, continues to provide a stable and robust growth outlook. With the acquisition overhang, the stock is at a significant discount to its peers despite its long term growth visibility," the brokerage note highlighted.
The chemical stock is down over 16% in 2022 (year-to-date or YTD) so far, whereas it has fallen more than 27% from its high of ₹3,533 it had hit in September 2021. PI Industries is a leading player in the agrochemicals space and has a diversified portfolio of products with presence in the domestic and international markets.
The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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