KR Choksey's research report on Ami Organics
During Q1FY23, Ami Organics Ltd reported Revenue of INR 1,310 Mn (+15.87% YoY / -8.71% QoQ). The export market and more specifically innovative businesses, were responsible for such growth. On operational front EBITDA in Q1FY23 stood at INR 229 Mn (+38.67% YoY) but dipped marginally on QoQ basis by 11.25%, OPM improved by 288 bps YoY and was flat QoQ at 17.46% in Q1FY23. Higher energy prices and reduced EBITDA from the speciality chemicals sector weighed on the EBITDA margins. Net Profit in Q1FY23 stood at INR 149 Mn showing an improvement of 8.76% YoY and saw a dip of 30% QoQ, mainly due to lower tax accountability in Q4FY22. NPM came at 11.37%, marginal impact of 74bps on YoY basis and 347bps on QoQ basis. EPS during the quarter came at INR 4.08 vs INR4 .36 in the same period last year.
At a CMP of INR 1,029 AOL is trading at a P/E multiple of 36.26x/27.22x its FY23E/24E earnings. We apply P/E multiple of 32.5x its FY24E earnings and thus continue to maintain our ‘BUY’ recommendation on the stock with the same target price of INR 1,229.
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