Motilal Oswal has given Buy recommendation for Coromandel International recommended buy rating on the stock with a target price of Rs 1035 in its research rep with a target price of Rs. 1035 in its research report issued on Dec 16, 2021
Motilal Oswal’s research report on Coromandel International
As per the Ministry of Fertilizer, CRIN’s overall volumes in Oct-Nov’21 declined by 20% YoY due to a 78% fall in trading volumes, whereas manufacturing volumes grew 12%. Growth in manufacturing volumes is aided by a favorable base in FY21, whereas volumes declined by 7% YoY in Oct-Nov’20 and 3% in 3QFY21. Total phosphatic fertilizer volumes grew 6% YoY in Oct-Nov’21 (on the back of a 6% YoY growth in Oct-Nov’20 and 8% YoY growth in the base quarter). The growth in phosphatic fertilizer volumes was on the back of 40% YoY growth in DAP volumes and 1% YoY growth in NPK volumes. NPK manufacturing volumes rose 7% YoY in Oct-Nov’21 (on the back of a 0.7% decline in Oct-Nov’20). Urea volumes declined by 92% YoY, whereas the same for SSP grew 14% in Oct-Nov’21.
We expect revenue/EBITDA/PAT CAGR of 8%/8%/10% over FY21-24E. We value CRIN at 17x FY24E EPS to arrive at our TP of INR1,035. We maintain our Buy rating.