The shares of the leading player in agrochemicals gained up to 5.2 percent after the company announced an acquisition of Plant Health Care Plc which is valued at 32.78 million pounds.
With a market capitalization of Rs 59,018.35 crore, the shares of PI Industries Ltd were trading at Rs 3,898.55 per share, increasing drastically by around 3.35 percent as compared to the previous closing price of Rs 3,777.10 apiece.
Description of Events:-
According to the company filing, PI Industries Ltd announced a 100 percent acquisition of Plant Health Care Plc, a UK-based company, which is valued at 32.78 million pounds. The completion of this acquisition may take around 3 months.
Matter explanation:-
Plant Health Care Plc entity will become a step-down subsidiary of the Company. The acquisition will enable the Company to offer integrated agri-solutions across both chemicals and biologicals.
Jefferies, one of the well-known brokerages globally, gave a ‘Buy’ call on the agrochemical stock with a target price of Rs 4,750 apiece, indicating a potential upside of 22 percent from Thursday’s price of Rs 3,898.55 per share.
Financial outlook:-
Looking forward to the company’s financial performance, revenue soared by 11 percent from Rs 1,566 crore in Q4FY23 to Rs 1,741 crore in Q4FY24, during the same time frame, the company’s net profit jumped notably by 32 percent from Rs 281 crore to Rs 370 crore.
Future pathway:-
The company plans to invest around Rs 500 crore as capital expenditure in FY2023-24 for maintenance in both agrochemicals and no agrochemicals businesses. This capex will include the expansion of existing facilities rather than setting up new greenfield projects, as PI Industries still has scope to expand at its current sites.
PI Industries is currently working on approximately 40 R&D projects, the majority of which are focused on the non-agrochemicals area. The company is developing cutting-edge R&D infrastructure to assist its expansion into new business sectors beyond agrochemicals.
Company Overview:-
PI Industries Limited is a holding company. The company manufactures and distributes agricultural chemicals. The company operates in two segments: agrochemicals and pharmaceuticals. Agchem Exports (CSM) and Domestic Agri Brands are part of the Agro Chemicals division.
Written by:- Abhishek Singh
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