ICICI Securities's research report on Deepak Nitrite
Deepak Nitrite’s (DN) Q1FY26 has shown marginal improvement over adj. Q4FY25 EBITDA; however, overall performance remains subdued. This was due to slower recovery in agrochemical, marginal volume growth in other AI segment applications and depressed spreads in phenolics. We expect a notable uptick in earnings to emerge H2FY26 onwards, on the back of project commissioning – nitric acid, hydrogenation, MIBK/MIBC and other solvents and nitration. Capex here would aid new product launches and margins. Polycarbonate integrated facility is taking shape with technology partners signed on; and capex intensity shall rise FY27 onwards.
Outlook
We cut our FY26/27E EPS by 2–5%; TP revised to INR 1,950 (from INR 2,000), valuing DN at 30x FY27E PE multiple (unchanged). Retain HOLD.
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