Motilal Oswal's research report on Godrej Agrovet
Godrej Agrovet (GOAGRO) reported a strong operating performance (EBIT up 23.5% YoY) in 1QFY26, primarily due to a sharp 3.6x/34.2% YoY growth in palm oil/crop protection (CP) EBIT, while Animal Feed (AF)/Dairy/ Poultry EBIT dipped ~17%/76%/76% YoY. Management has maintained its revenue growth guidance for FY26; however, we factor in the weak outlook for the crop protection business, largely due to continued pricing pressure and higher level returns expected in 2QFY26. Hence, we reduce our FY26E EBITDA by 7%, while largely maintaining our FY27E EBITDA. We reiterate our BUY rating on the stock with an SOTP-based TP of INR940.
Outlook
We revise our FY26E EBITDA estimate downward by 7%, while largely maintaining our FY27E projections. We reiterate our BUY rating on the stock with an SOTP-based target price of INR 940.
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