Dhanuka Agritech Q2 Results Review - Stellar Performance; Innovation Products To Drive Growth: Axis Securities

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..Axis Securities Report.Dhanuka Agritech Ltd. posted its strongest numbers in Q2 FY24. The company beat our and industry estimates on all fronts despite the macro headwinds. Revenue missed our estimate by 41% (up 14%/67% YoY/QoQ). Ebitda margins elevated due to better operating performance to 23% against 18%/12% YoY/QoQ. This led to overall growth in Dhanuka Agritech’s profit after tax which came in at Rs 102 crore, up 39%/208% YoY/QoQ, beating our estimates by 86%. .Outlook: Dhanuka saw channel inventory easing out in July 2023 after good rainfall across the country. Prices of pesticides have stabilised or are trending upward in certain segments. With refilled reservoirs and improved groundwater levels, Q3 FY24 and Rabi season looks promising for Dhanuka Agritech..Valuation and recommendation: Dhanuka Agritech has introduced new molecules. With these new introductions, we believe the company will add good volumes in the topline moving ahead. The management anticipates the company’s gross margins to improve in Q3 FY24 onwards. We have, therefore, revised our estimates upwards and revised our multiple upwards to 15 times FY25E which brings a target price of Rs 960/share, implying an upside of 14% from the current market price..Key risks to our estimates and target priceGlobal recessionary environment, especially a long recession, which could affect demand for upstream players.The impact of El Nino on Indian agriculture can affect the demand for PIs products.Delay in capex and commercialisation of new molecules could affect growth. Stress on return on capital employed in initial phases of acquisition..Click on the attachment to read the full report:.Coromandel International Q2 Results Review - Near Term Headwinds To Cap The Stock: 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.

Dhanuka Agritech Q2 Results Review - Stellar Performance; Innovation Products To Drive Growth: Axis Securities

The company expects double-digit growth in revenue for FY24 and FY25.

Choose a plan