Dolat Capital Market has given Buy recommendation for UPL with a target price of Rs. 850 in its research report issued on May 13, 2021

Dolat Capital Market’s research report on UPL

UPL’s strong 4QFY21 and FY21 performance was buttressed by a strong performance in Latin America (up 40% YoY) and a robust growth led by volumes in Europe (up 17%) and India (up 23%). Sales/EBITDA/PAT beat our estimates, with Sales growth of 14.9% YoY to Rs 127.9bn and EBITDA growth of 39.2% YoY to Rs 26.5bn. UPL reduced its gross debt by Rs 51.0bn and net debt by Rs 32.4bn in FY21. UPL, as per their guidance achieved a net reduction of 7 days in their cash-conversion cycle to 89 days. Also, over-achieved its EBITDA growth guidance by reporting an EBITDA growth of 23.3% YoY to Rs 83.5bn for FY21.


We maintain our positive stance on UPL, and have revised our estimates. Deleveraging, resilient product pipeline and new partnerships on the anvil are mid-term re-rating triggers which compel us to increase our EV/EBITDA multiple to 8.5x. We revise our target price to Rs 850/share and remain buyers on the stock