Bullish on Coromandel International, Rallis: Emkay Global

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Q: I am just looking at a January report of Emkay in terms of fertilizer stocks and the target for Coromandel was Rs 263, it is already at Rs 316, for Rallis the target was Rs 1153, the stock is already at Rs 1261, so these stocks are already about 15-20% higher than your previous target prices, how more upside can we see in these stocks?

A: When my analyst gives a price we definitely have a very conservative estimates. What we are trying to showcase today is what kind of opportunity is there in the entire segment. So if you look at the entire segment or if you look specifically for Rallis or Coromandel , the opportunity is very big. We believe that the financial numbers should be taken as one of the benchmark. You should look at is what is the external opportunity available to them. Today we just have a 0.5 kg consumption on pesticides. But now today's farmer is more affluent and he is not taking farming as a substance for living. He is now taking it as a commercial for living, so for him one kg of pesticide will actually give me better yield so that is what he is looking at. So they are more commercial than they use to be.

Q: You do not fancy stocks like Jain Irrigation or IVRCL which is into a lot of irrigation projects, stocks that are handling the water side?

A: This time my conference has restricted 2-3 sub-segments that is fertilizers, seeds and crop care. We will be coming out with agri output also you will have to just wait for sometime, but we are focusing on even on that.