Buy PI Industries target of Rs 1750: Sharekhan

Sharekhan's research report on PI Industries

We expect revenue and earnings CAGR of 27.6% and 29.8%, respectively, during FY2019-FY2022E (Isagro numbers factored in from Q4FY2020). Management retains its FY2020E guidance of ~20% y-o-y improvement in performance, led by healthy order book, commissioning of additional capacity and contribution from newly launched brands. The company delivered in-line results during Q3FY2020 with revenue up by 20% y-o-y to Rs. 850 crore; operating margin improved by 94 BPS y-o-y to 21.9% and PAT increased by 13.0% y-o-y to Rs. 121 crore.

Outlook

We upgrade our rating on PI Industries Limited to Buy with a revised PT of Rs. 1,750 per share owing to aggressive expansion strategy to tap the robust and encouraging demand environment.