Accumulate Rallis India; target of Rs 321: Prabhudas Lilladher

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26 Aug, 2025 12:21

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We have increased our EBITDA and PAT estimates between 0-5% for FY22- 23, roll forward to FY23 estimates and upgrade the stock from hold to ACCUMULATE with revised target price of Rs321 (Previous TP 279) based on 20x FY23E EPS of Rs 16. Rallis India reported inline set of results driven by 19% growth in domestic business. Cropcare segment grew 5% (volume growth of 10%) driven by 15% growth in domestic business. International business dragged cropcare segment with 17% decline in realisations, due to sharp decline in Metribuzin price and drop in CRAMS business volumes. Exoff metribuzin & PEKK, demand is resilient in international business. Domestic business is on a strong footing in both crop protection and seeds with healthy demand, new launches (1 in CP, 2 in crop nutrition) and faster collection. RALI has completed capex for 3 molecules in Q3, while other 2 molecules will be completed by April 21.

The management also plans to invest Rs1.2bn in MPP, to be operationalised by H2’22. Management’s strategy of capacity expansion driven growth continues and we maintain our positive bias from a long term point of view.

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