Hold Deepak Nitrite; target of Rs 2000: ICICI Securities

ICICI Securities research report on Deepak Nitrite

Deepak Nitrite’s (DN) Q4FY25 underlying print suggests margin pressure intensified in Q4 with rise in supplies from China, particularly for agrochemical intermediates. However, it had early signs of recovery across segments with higher volumes and margin improvement. Yet, DN has refrained from providing any guidance for H1FY26; however, for FY26, it expects performance to normalise. It has taken measures to increase resilience of business by moving up in agrochemical value chain into technical partnerships with customers, and adding higher value products in agro and pharma intermediates. It has also added new products in personal care.

Outlook

Cut FY26/27 EPS by ~6% each; revise TP to INR 2,000 (from INR 2,120), valuing DN at 30x FY27E PE multiple (unchanged). Downgrade to HOLD (from Add).