Target: ₹4,080

CMP: ₹3,296.10

Navin Fluorine International (NFIL) produces many chemicals that are major compounds used in manufacturing key intermediates of several drugs.

We find the following molecules to have a high growth potential within the pharma space: 3-(3,3,3-triflurto-2,2-dimethylpropoxy)-1h-pyrazole; ) 4-methyl-2-(1,1,1-trifluoro-2-methylpropan-2-yl)pyridine; 1-(2-bromo-4-chlorophenyl)-4-trifluoromethyl-1h-1,2,3-triazole; and 8-chloro-6-(trifluoromethyl)imidazo(1,2-A)pyridine-2-carboxylic acid (QEK31).

Within the agrochemicals space, certain molecules are stagnating like 2 fluoro-6-trifluoro methyl pyridine 2, which is used to make picoxystrobin, but it can have multiple pharmaceutical usage. Similarly, 3-trifluoro methyl acetophenone (TFMAP) is used to make trifloxystrobin (a fungicide) but recently a patent has been filed by Ildong Pharmaceuticals where this molecule is used to make drugs for pikfyve activity-related cancer disease, and certain inflammatory disease as well.

Similarly, fluorobenzamide can be used to make 4-amino-2-fluorobenzamide, which can be used to treat multiple cardiovascular disorders.

NFIL’s FY24F EPS may decline by 31 per cent y-o-y, driven mainly by agrochem slowdown, but future growth to be driven by less cyclical pharma products. We have analysed its pharmaceutical products in detail. NFIL is making multiple potential intermediates for cystic fibrosis, cancer, and pain treatments. The correction in its stock price based on cyclical factors is a buying opportunity. We upgrade the stock’s rating to Add with a lower TP of ₹4,080 (earlier: ₹4,655)