Nalanda Securities bullish on Sharda Cropchem has recommended buy rating on the stock with a target price of Rs 504 in its research report dated August 30, 2018.
Nalanda Securities' research report on Sharda Cropchem
SHCR is engaged in activities of identifying new products and registration opportunities. Once these opportunities are identified, they immediately begin with the process of seeking registration from the regional authorities. The entire manufacturing of the products is outsourced to vendors in China which further helps them to mitigate the sourcing risk. It is able to maintain an asset light model owing to non-investment in land, plant and equipment for research and manufacturing activities.
At CMP of INR 396.75 the stock is trading at 6.1x FY20E EV/ EBITDA and 11x FY20E EPS. We value the company using an average of PE and EV/ EBITDA methodology to arrive at a target price of INR 504.
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