ICICI Direct has given Hold recommendation for Hikal with a target price of Rs. 290 in its research report issued on Aug 16, 2022

ICICI Direct’s research report on Hikal

Hikal is predominantly a B2B player that provides intermediates and active ingredients to global pharmaceutical, animal health, crop protection and specialty chemical companies. Pharma & crop protection are 58% & 42% of operating revenue, respectively. Pharma business is currently divided into 50:50 ratio of APIs, CDMO. Animal health business accounts for 20-25% of CDMO business • In crop protection, 69% revenues are derived from CDMO while remaining is from proprietary products, specialty chemicals & specialty biocides • One of the largest suppliers of Gabapentin API (CNS) and in crop protection, one of the largest suppliers of Thiabendazole (TBZ).


Downgraded from BUY to HOLD due to the adoption of cautious stance in the backdrop of near to mid-term headwinds as we wait for improvement in macro environment in both demand and supply side to improve before taking a directional call. Valued at Rs 290 i.e. 20x FY24E EPS of Rs 14.4.

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