5 Stocks You Cannot Miss To Buy From The Agri Inputs & Chemicals Space

5 Stocks You Cannot Miss To Buy From The Agri Inputs & Chemicals Space

Here are a list of stocks that Sharekhan has a “buy” call from the agri inputs and chemicals space. The brokerage recently came up with its report on the space and here are some of the stocks to buy.

Preferred stock Picks:

UPL, PI Industries, Sumitomo Chemical India, SRF, NOCIL, Vinati Organics and Gujarat Fluorochemical.

According to Sharekhan, Agri-input players posted yet another quarter of robust revenue/earnings performance but margins were weak, primarily due to input cost pressures. “Speciality chemical companies’ performance was impacted by subdued demand across discretionary end-user segments like auto, dyes, and pigment.

However, their margins improved q-o-q, primarily due to lower input and operating costs. Aggregate PAT for agri-input companies under our coverage grew strongly by 23.4% y-o-y, with underperformance shown only by Sumitomo Chemical India. Aggregate PAT for speciality chemical companies under our coverage decline by 9%/3% y-o-y/q-o-q with earnings beat from SRF/Aarti Industries/Vinati Organics while Atul/NOCIL/Sudarshan Chemical missed our estimate,” the brokerage has said.

Near-term demand concerns persist for specialty chemical players with high exposure to exports/ discretionary sectors given talks of global economic slowdown. Having said that, the recent plant closures in Europe provide a ‘Europe +1’ opportunity and scope for market share gain for Indian chemical players, given the massive capex plan. “Recent fall in the stock price of quality companies (SRF, PI, UPL, Vinati Organics) provides a good entry opportunity as long-term earnings growth outlook remain intact,” Sharekhan has noted,

Disclaimer

The stock have been picked from the brokerage report of Sharekhan. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.