Accumulate Vinati Organics; target of Rs 2002: KR Choksey

KR Choksey recommended Accumulate rating on Vinati Organics with a target price of Rs 2002 in its research report dated February 03, 2024.

Broker Research

February 04, 2025 / 12:12 IST

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KR Choksey's research report on Vinati Organics

VO revenue came in line with our estimates while PAT surpassed our expectations. Revenue stood at INR 5,217 Mn, up 16.4% YoY (-5.7% QoQ). EBITDA grew to INR 1,424 Mn, up 24.2% YoY (+6.5% QoQ); EBITDA margin came in at 27.3% (+170bps YoY/+312bps QoQ). VO reported PAT of INR 937 Mn, up 21.8% YoY (-10.2% QoQ%), beating our estimates, resulting in PAT margin expansion by 79bps YoY (- 90bps QoQ) to 18.0%. We maintain our FY26E/FY27E EPS to INR 50.0/ 57.5, supported by strong expansion in ATBS capacity by Q4FY25E, enhanced capacity utilization in Antioxidants (AO) segment and ramp-up of the Veeral Organics plant.

Outlook

We rollover our valuation to FY27E and reiterate our target price to INR 2,002, valuing the VO at P/E of 34.8x, This valuation is underpinned by the expectation of sustained margins at 26.0%, further enhanced by the commercialization of capex. Accordingly, we maintain our “ACCUMULATE” rating on the shares of Vinati Organics Ltd.

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