Neogen Chemicals - Sanguine Growth Trajectory, Valuations Rich: IDBI Capital

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..IDBI Capital Report.Key Highlights and Investment RationalePositive developments on Battery Chemicals: Neogen Chemicals Ltd. has commenced discussion for Memorandum of Understanding with respect to commercial terms for Electrolyte with multiple Indian cell manufacturers. The company has also initiated dialogue for Lithium Electrolyte Salt Supplies with more than ten overseas customers. Neogen had earmarked Rs 4.5 billion of capex for catering to the flourishing battery chemicals business maintaining debt/equity of less than 1.25 times. However this capex may be revised upwards post the MU Ionic Solutions Corporation agreement taking into account the demand projections of the customers.  .Valuation and outlook: Both advanced intermediates and custom synthesis manufacturing (pharma and agro as key customers) are expected to contribute healthy proportion of sales in the coming years and would remain solid growth drivers even beyond. AI and CSM are the two more profitable businesses and would drive improvement in profitability. However in the light of valuations being rich, we maintain our 'Hold' rating with a target price of Rs 1,700..Click on the attachment to read the full report:.Neogen Chemicals - Battery Chemicals Execution Remains The Key: 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.

Neogen Chemicals - Sanguine Growth Trajectory, Valuations Rich: IDBI Capital

The BuLi chem acquisition will add expertise in lithiation chemistry to the company’s repertoire.

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