Hold P.I. Industries; target of Rs 2026: Prabhudas Lilladher

Prabhudas Lilladher recommended hold rating on P.I. Industries with a target price of Rs 2026 in its research report dated October 30, 2020.

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November 03, 2020 / 16:34 IST

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on P.I. Industries

PI reported better than expected results driven by strong demand for key commercialised molecules and Isagro’s domestic performance. Change in business mix and savings in other expenses led to better than expected margin expansion. We believe ramp up of recently commercialised molecules and pipeline of +40 products will drive growth in coming years, along with foray in pharma intermediates and inorganic opportunities. Management is evaluating few options very actively for inorganic growth and maintains a guidance of utilising QIP proceeds in next 18 months. With inorganic opportunities, management’s endeavour is to generate better returns over a period of time than the current business. We are also keenly observing PI’s progress into the Pharma value chain as it is likely to be a key determinant for further re-rating. Accordingly, we have increased our Topline/EBITDA/APAT estimates by 5%/13%/13% for FY21, 0%/5%/3% for FY22 and 0%/3%/1% for FY23.

Outlook

We have factored in higher income from investments, until the amount is deployed for growth purpose. Maintain HOLD with revised target price of Rs2026 (previous TP Rs 2000) based on 30x FY23 EPS of Rs67.5.

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