Emkay Global Financial is bullish on Dixon Technologies has recommended buy rating on the stock with a target price of Rs 5705 in its research report dated August 12, 2020.
Emkay Global Financial's report on Advanced Enzyme Technologies
Q1 revenues came in marginally above our estimates (flat yoy). Despite the challenges during the quarter, ADVENZY registered the highest quarterly sales in India (up 9.5%), whereas USA and European markets were flat. Asia & Other markets recorded de-growth. The Human Healthcare segment outperformed with 8% yoy growth (highest quarterly sales). Animal Healthcare/Industrial Processing segments faced headwinds. The aid received under the CARES Act (~Rs40mn) for US entities supported the bottom line. Management is optimistic about sustainable demand in nutrition and pharma businesses (up 10% in FY20; ~40% of revenue) and maintains its long-term revenue target, which shall be aided by both organic and inorganic opportunities.
Amid economic uncertainty and headwinds in the USA region, ADVENZY’s specialized and essential solutions consistently deliver impressive margins. We value the stock at Sept’22E EPS (15x) and maintain Buy/OW in EAP, with a TP of Rs238.
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