Nov. 27, 2009
Nagarjuna Agrichem has target of Rs 350, says Sanjay Chhabria, Equity Analyst.
Chhabria told CNBC-TV18, "Nagarjuna Agrichem
belongs to the Hyderabad based Nagarjuna Group and it is manufactures a comprehensive range of agro chemical pesticides and also does a custom manufacture of fine chemicals. The company has a tie-up with large agro chemical majors and MNC for domestic and export markets. The company has been continuously expanding production capacities and reporting better results."
He further added, "For the year ended March 2009 the company post a 46% rise in net sales to Rs 605 crore. Whereas net profit increase 91% to Rs 49 crore. A small equity of Rs 14.9 crore the EPS stood at Rs 33 and the dividend declared was 50%. In half yearly results the company posted a 42% rise in net profit to Rs 28.5 crore on sales of Rs 338 crore. The company is from the farm sector and it combines with a very high ROE along with a low reasonable valuation."
"Looking at the valuations of around 7 times FY09 earnings is around 5.7 times expected FY10 earnings. Looking at listed peers like Rallis and Bayer Cropscience I have a price target of Rs 350 on the stock."