HDFC Securities' research report on Sudarshan Chemical
SCIL has product offerings similar to those of the global players but has been unable to gain market share, post the exit of the global majors. The stock is trading at 19x FY25E EPS, which we believe is contextually high (RoE of 14/17% for FY24/FY25E). Q4 EBITDA/APAT were 89/579% above our estimates, mainly owing to a 26% rise in revenue, lower-than-anticipated raw material cost and tax rate.
Outlook
We maintain REDUCE on Sudarshan Chemical (SCIL), with a price target of INR 454 (WACC 11%, terminal growth 3.5%).
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