Indian Stock markets clocked sharp gains after a gap-up start on Thursday as global markets strengthened. Brent crude is hovering around $ 135 per barrel and many sectors have started feeling the heat of the raw material inflation that follows. Chemical stocks reeling under pressure as well. Angel One has suggested its top picks in the chemicals sector, as of March 8th 2022:
P I Industries Ltd
P I Industries provides custom-synthesis and manufacturing solutions (CSM) and is a leading player in this sector. This accounted for 70% of its revenues in 2021 and the company is increasing its share of high margin CSM business driven by a strong relationship with global agrochemical players. Further, it intends to diversify its CSM portfolio to Pharma API, fluorochemicals, electronic chemicals and so on, which will help drive business.
The brokerage expects PI industries to post revenue/ PAT CAGR of 20.0%/22.5% between
FY21-24 driven by 20% growth in the CSM business over the next 2-3 years.
- CMP: ₹ 2,574.60
- Target Price: ₹ 3,440
- Upside: 33.61%
- Beta: 1.0
- 52-week High/Low: ₹ 3534/ ₹ 2123
Jubilant Ingrevia Ltd
The company was demerged from Jubilant Life Sciences Ltd. It has a vast array of products and is one of the top two producers of Pyridine – Beta and vitamin B3 globally. It derives about half of its revenue from the life science and chemicals division, 32% from speciality chemicals and 18% from the nutrition & health solution business.
Its PE ratio is lower than most companies in the sector and this is a good sign. The brokerage believes that there is value in the stock at current levels and hence rate it a BUY.
- CMP: ₹ 470.00
- Target Price: ₹ 700.00
- Upside: 49.93%
- Beta: 1.6
- 52-week High/Low: ₹ 878/ ₹ 244
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