Hold Jubilant Ingrevia; target of Rs 743: Prabhudas Lilladher

Prabhudas Lilladher's research report on Jubilant Ingrevia

JUBLINGR reported a consolidated revenue of Rs10.38bn, broadly in line with our estimates. The Specialty Chemicals segment registered 11% YoY growth, driven by strong performance in Fine Chemicals and CDMO. The Pharma side witnessed stable demand and pricing, while the Agrochemical portfolio showed signs of modest recovery during the quarter. Improved product mix within the high-margin Specialty segment led to a 720bps YoY expansion in EBITDAM. Deliveries under the $300mn agrochemical CDMO contract are expected to commence by early CY26. The Nutrition segment saw a 4% YoY revenue decline, along with a 130bps sequential drop in margins, primarily due to lower volumes and modest correction in niacinamide prices. Meanwhile, the Chemical Intermediates segment experienced a gradual sequential recovery, led by volume growth, although pricing remains under pressure. Looking ahead, we expect the Specialty segment to remain the key growth driver.

Outlook

However, pricing headwinds in the Nutrition and Chemical Intermediates segments continue to pose challenges. At an implied valuation of 37x FY27 EPS, we maintain “HOLD,” with a target price of Rs743, based on a sum-of-the-parts (SOTP) valuation approach.

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