ICICI Securities: Hatsun Agro Expects Life High Ebitda Margin In FY21

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..ICICI Securities Report.Hatsun Agro Products Ltd. reported 10% revenue decline in Q1 FY21 and it was largely due to lower sales of ice cream. Adjusting for lower ice cream, we note the dairy (milk and curd) and cattle feed reported low single digit growth. Considering the carryover effect of price hikes in FY20, we believe the volumes would have declined 4-5%. As the company’s revenue contribution from business to business (B2B) customers and hotel restaurant and cafe (HoReCa) is negligible, there is limited impact of lockdown on Hatsun’s business.We expect Hatsun to report profit after tax (PAT) compound annual growth rate (CAGR) of 46% over FY20-FY22E with return on equity (RoE) higher than cost of capital. Though we remain positive on the company’s business model due to the established moats and growth opportunities, we believe upside is limited at current valuations. Hence, we retain Hold with a discounted cash flow (DCF) based target price of Rs 650 (implied price to earning 43 times FY22E)..Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint 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 brokerage and do not represent the views of BloombergQuint..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

ICICI Securities: Hatsun Agro Expects Life High Ebitda Margin In FY21

ICICI Securities: Hatsun Agro Expects Life High Ebitda Margin In FY21

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