Deepak Nitrite - Headwinds To Persist As New Capacities Are Added: Motilal Oswal

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.The phenol/acetone spread over raw materials has declined 16% YoY to Rs 90/kg during H2 FY23 till date (versus Rs 107/kg in H2 FY22) on account of China’s Covid-related lockdowns, which resulted in stockpiling of Phenol and disruption in trade activities. China’s steps toward self- sufficiency in phenol and increased competition in the region could result in a structural glut in the overall market, in turn leading to the downtrend in phenol margins to continue. Deepak Nitrite Ltd.’s planned capex of Rs 15 billion in FY23-24 aimed partly for backward integration and partly towards downstream products of Acetone (MIBK/MIBC) should drive growth in the near term. Moreover, the recently announced Rs 10 billion expansion into polycarbonate compounding and nitrite project in Oman would drive growth in the medium term. Although Deepak Nitrite has aggressive growth plans, the commodity nature of its products does not leave much upside for investors. If it forays into specialty products or complex commodities, it would certainly command a better valuation multiple..Click on the attachment to read the full report:.Rossari Biotech Management Meet Key Takeaways - FY24 Should Be The Year Of Hope: Nirmal Bang.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Deepak Nitrite - Headwinds To Persist As New Capacities Are Added: Motilal Oswal

Ebit margins of Deepak Nitrite's phenolic segment slipped to 8% in Q2 FY23, the lowest level since Q4 FY20.

Choose a plan