India Pesticides IPO - Niche Company At Reasonable Valuations: Prabhudas Lilladher
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Prabhudas Lilladher Report
India Pesticides Ltd. is a niche play in manufacturing of pesticides technical (79% of revenue) and formulation (21%).
Our positive stance emanates from-
1. it is the sole manufacturer of five technical in India and leading manufacturer of certain molecules like Captan, Folpet and Thiocarbamate herbicide and
2. none of its technical molecules are classified under “red triangle”.
The company reported a topline/Ebitda/profit after tax compound annual growth rate of 38%/67%/75% over FY19-21.
We expect growth momentum to sustain led by
1. six to eight molecules to be commercialised at its new 10,000 million tonnes per annum capacity expansion and
2. greenfield expansion at a new site for which the company is currently in discussion with Uttar Pradesh government to acquire land.
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