BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Centrum Broking Report
Dhanuka Agritech Ltd. reported Ebitda/profit after tax at Rs 653/Rs 518 million, up strongly by 3.3x/3.5x YoY, well ahead of Centrum's estimates of Rs 546/Rs 439 million with a strong 70.7% YoY growth in revenue at Rs 3.7 billion (Centrum estimate Rs 2.7 billion). The strong revenue growth has been driven by better Kharif sowing pattern, good monsoons and strong farmer incomes, new products launched in the last five to six months and March sales postponement and July sales preponement to Q1 due to Covid-19.
Despite Q1 traditionally being a weak quarter for Dhanuka Agritech, strong growth in Q1 FY21 coupled with guidance of a sustained growth in Q2 and Q3 will drive very strong FY21E earnings given the monsoons, better pricing realisation for farmers plus higher cash transfers by the Government, aggressive marketing and healthy product pipeline. Ergo, we see revenues growing at a record pace of approximately 25.2% in FY21 and also a healthy approximately 14.8% even on this base in FY22E, driving a 25/23.1% compound annual growth rate over FY20-22E in Ebitda/earning per share. We reiterate Buy.
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