KR Choksey's research report on Laxmi Organic Industries
Laxmi Organic Industries revenue grew by +2.8% yoy at INR 7,566Mn (-14.0% qoq) on account of both Acetyl Intermediates (AI) and Specialty Intermediates (SI) business growth of 33.9% / 10.3% yoy. However, there was a sequential de-growth across both the segments due to demand pressures across the world. EBITDA reported at INR 1,015Mn (-30.1% yoy / +39.2% qoq). EBITDA margin stood at 13.4% (-631bps yoy / +513bps qoq); the improvement in margin performance on a sequential basis was mainly on account of lower cost of goods sold, decline in staff and finance costs. Net Profit de-grew by 36.6% yoy at INR 649Mn (+12.9%qoq), Net margin reported at 8.6% (-532bps yoy / +204bps qoq). EPS stood at INR 2.43 in Q1FY23 compared to INR 3.85 in Q1FY22.
We revise our target price at INR 380 by assigning PE multiple of 26.0x to FY24E EPS (Previous TP: INR 530) and retain our ‘BUY’ recommendation on the stock with an upside 22% over the CMP.
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