Accumulate PI Industries; target of Rs 270: Dolat Capital

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26 Aug, 2025 12:21

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Dolat Capital's report on PI Industries

"PI Industries, domestic business grew by 17 percent YoY during the quarter to Rs 129 Cr, dominated by volume growth of over 10 percent and 6-7 percent price impact. In licensed products contributed 65 percent to the total revenues in 9MFY14. The company currently has 28-30 products in its domestic business. The company will be launching two new molecules in FY15 under section 9(3) which we believe will help to maintain the growth momentum in the domestic space assuming normal monsoons."

"CSM (Exports) segment: CSM business continued its growth momentum during the quarter. It grew by 36 percent YoY to Rs 234 Cr. So far the company has commercialized 14-15 products, expected to commercialize 3 more products in FY15. The current order book stands at $366 Mn with an execution period of 3 years. Phase I of Jambusar is operating at 85 percent capacity utilization. Jambusar facility has contributed revenues of Rs 90 Cr during 9MFY14. The company expects Jambusar to turn more accretive on sales by FY16, which will eventually lead to reduction in tax rates. The company has started work on Phase II which will be operational by Q4FY15."

View: "We expect consolidated revenue to grow by 23 percent CAGR during FY13-16E on the back of higher contribution from the CSM business (From 52 percent in FY13 to 62 percent in FY16). The launch of two new inlicensed products in FY15 in the domestic space along with its existing strong brands will help sustain double digit growth rates. We estimate growth of 14 percent in domestic agri over FY13-FY16E. We also estimate that CSM segment will grow by 30 percent CAGR during FY13-FY16E on the back of commercialization of 3 new products in FY15 and higher contribution from the Jambusar facility. We expect PAT to grow by 36 percent during FY13-FY16E, and cash flow generation to drive value," says Dolat Capital research report.

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