Dhanuka Agritech Ltd (Q2 FY15) – BUY
CMP Rs511, Target Rs800, Upside 56.5%
CMP Rs511, Target Rs800, Upside 56.5%
- Q2 FY15 PAT grew 30.2% yoy well above our estimates on the back of improvement in gross margins and strong operating performance.
- Revenue stood at Rs.2,833mn, in line with our expectation of Rs2,825mn.
- Gross margins expanded by 197bps yoy to 37.5% driven by better product mix and stable RM cost of specialty products.
- Operating margins at 19.5% came as a positive surprise; beat our expectations of 16.7%.
- Outlook remains strong; Maintain Buy with a 24-month price target of Rs800.
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