Buy Sumitomo Chemical India; target of Rs 659: Sharekhan

Sharekhan's research report on Sumitomo Chemical India

Sumitomo’s reported revenue of Rs. 988 crore, marking a 9% increase compared to the same period last year and an 18% rise from the previous quarter, exceeding our projections by 5%. EBITDA stood at Rs. 245 crore, up 31% y-o-y and 52% q-o-q, surpassing our estimates by 30%. PAT stood at Rs. 67 crore, up 29% y-o-y and 51% q-o-q.

Outlook

Improved domestic demand on account of good monsoon, ramp-up of already completed capex, and increased margins bodes well for the company. We have increased our FY2025/FY2026 earnings estimates and have introduced FY2027 estimates. Hence, we have revised our PT to Rs. 659.