Comments
Amrapali Aadya
Coromandel
International (Buy)
CMP: ₹411.55
Target: ₹490
Coromandel International, a part of the Murugappa Group of companies, is a leading manufacturer of a wide range of fertilisers and pesticides. Coromandel, India’s second largest phosphoric fertilisers players, is in the business segments of fertilisers, specialty nutrients, crop protection and retail.
The company has best in class financials along with excellent return ratios. As we are expecting the direct subsidy transfer to lower the working capital requirement of the company, we are expecting company’s RoCE/ RoE would reach 22-24 per cent by FY19 given sharp improvement in profitability.
The company is having best in financial ratio in the sector. Going ahead, fertiliser companies are likely to receive more attention on account of increasing government focus on the balanced usage of nutrient along with increase in farmers’ income. Coromandel, having strong fundamentals along with greater reach in the market, is well placed to take the advantage of increasing demand of complex fertilisers. Also company is likely to get benefitted from the growing non-subsidy business as well as backward integration of phosphoric acid.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.