Buy Kaveri seeds Company; target of Rs 806: LKP Research

LKP Research's research report on Kaveri seeds Company

Kaveri seeds Company Ltd (KSCL) is a four decade old agri-inputs company with strong brand equity among the Indian farmers. At present it is one of India’s fastest growing seed companies with a wide portfolio, large network of distributors and dealers and a very wide customer base spanning the country. The company has a pan-India presence with a strong distribution network of ~60,000 distributors (direct & in-direct) and retailers across 29 product locations in distinct agro-climatic zones of India. KSCL has 1 million sq.ft stateof-the-art warehouse facilities at strategic locations across the country. The company has an extensive product portfolio encompassing a wide range of high-yielding seeds for field crops such as maize, cotton, rice, pearl millet, mustard, wheat, sorghum, sunflower, and various vegetable crops. With a strong local presence, the Company has also experienced remarkable growth in the international market, successfully exporting its products to countries such as Pakistan, Sri Lanka, Bangladesh and Vietnam.

Outlook

We expect KSCL to post a Revenue/EBITDA/PAT CAGR of 11%/16%/14% respectively over FY23-25E. We initiate coverage on KSCL with a BUY rating and a one-year TP of ₹806.