Motilal Oswal 's research report on Coromandel International
CRIN's 4QFY20 revenue grew 9% driven by higher manufacturing volumes (+13% YoY) and lower RM costs (gross margins expanded 520bp to 35%), which in turn led to 51% YoY EBITDA growth. PAT more than doubled on the back of lower tax rate and interest cost. Factoring in CRIN's better-than-estimated 4QFY20 performance, we have increased our earnings estimates by 8%/4% for FY21/FY22E. Maintain Buy.
Outlook
We expect revenue/EBITDA/PAT CAGR of 8%/9%/11% over FY20-22E. We value CRIN at 17x FY22E EPS (it has traded at an average P/E of 16x over the last three years) to arrive at a TP of INR766. Maintain Buy.
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