Neutral Deepak Nitrite; target of Rs 1887: Motilal Oswal

Motilal Oswal's research report on Deepak Nitrite

DN reported a miss on our estimates. EBITDA came in 12% lower than our estimate at INR3.6b. EBITDA margin, at 17.3%, was also below our estimate of 20.5% – the lowest since 3QFY19. The miss was largely led by the Advanced Intermediates segment. EBIT margin declined to 18% in the Advanced Intermediates segment.

Outlook

we maintain our Neutral rating. Valuing the stock at 22x FY24E EPS, we arrive at our TP of INR1,887.