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What is the story about?
Shares of UPL Ltd. surged as much as 8% on Tuesday, February 3, after brokerages raised their target prices following a strong December quarter performance.
The agrochemicals major reported a Q3 result that came in well ahead of estimates, driven by robust revenue growth, margin improvement and a meaningful reduction in debt, while maintaining its FY26 guidance.
Kotak Institutional Equities retained its 'Sell' rating on the stock but raised its target price to ₹630 per share.
The brokerage said the operating performance in Q3 beat expectations, although below-the-line items were weaker.
Kotak added that with FY26 EBITDA growth guidance of 12-16% maintained, it has made only modest revisions to its FY26-28 estimates.
Investec, on the other hand, maintained a 'Buy' rating and raised its target price to ₹975 per share.
The brokerage said that Q3 EBITDA rose 13% year-on-year, about 12% above estimates, led by a strong beat on both revenue and margins.
Europe and Rest of the World delivered strong double-digit growth, while other geographies posted mid-single digit growth. Growth in the Americas remained muted at 3% year-on-year as the company deferred shipments worth $30 million in anticipation of a trade deal.
To mitigate tariff-related risks, the company has implemented price hikes and is restructuring its supply chain by shifting from importing formulated products to importing technicals, which are tariff-exempt.
Management expressed confidence in delivering growth in Q4 despite a high base and expects net debt to EBITDA to decline to 1.6-1.8x in FY26, compared with 2.1x in FY25.
UPL reported revenue growth of 12% in Q3, well above the estimated 5%, driven by higher volumes, particularly in the Advanta business, and supported by favourable foreign exchange.
EBITDA grew 13% against expectations of flat growth, aided by an improved product mix, higher capacity utilisation and lower input costs.
Net debt stood at ₹23,317 crore, down ₹2,553 crore year-on-year, and more than $800 million lower when adjusted for perpetual bonds. Net working capital increased to 116 days from 107 days a year ago.
Regionally, growth was led by Europe, up 21%, and Rest of the World, up 32%, with continued momentum in India and the Americas.
The company maintained its FY26 guidance of 4-8% revenue growth and 12-16% EBITDA growth.
Among platforms, Advanta delivered strong growth of 22%, the crop protection segment rose 8% on higher volumes, while specialty chemicals surged 42%.
The agrochemicals major reported a Q3 result that came in well ahead of estimates, driven by robust revenue growth, margin improvement and a meaningful reduction in debt, while maintaining its FY26 guidance.
Kotak Institutional Equities retained its 'Sell' rating on the stock but raised its target price to ₹630 per share.
The brokerage said the operating performance in Q3 beat expectations, although below-the-line items were weaker.
Kotak added that with FY26 EBITDA growth guidance of 12-16% maintained, it has made only modest revisions to its FY26-28 estimates.
Investec, on the other hand, maintained a 'Buy' rating and raised its target price to ₹975 per share.
The brokerage said that Q3 EBITDA rose 13% year-on-year, about 12% above estimates, led by a strong beat on both revenue and margins.
Europe and Rest of the World delivered strong double-digit growth, while other geographies posted mid-single digit growth. Growth in the Americas remained muted at 3% year-on-year as the company deferred shipments worth $30 million in anticipation of a trade deal.
To mitigate tariff-related risks, the company has implemented price hikes and is restructuring its supply chain by shifting from importing formulated products to importing technicals, which are tariff-exempt.
Management expressed confidence in delivering growth in Q4 despite a high base and expects net debt to EBITDA to decline to 1.6-1.8x in FY26, compared with 2.1x in FY25.
UPL reported revenue growth of 12% in Q3, well above the estimated 5%, driven by higher volumes, particularly in the Advanta business, and supported by favourable foreign exchange.
EBITDA grew 13% against expectations of flat growth, aided by an improved product mix, higher capacity utilisation and lower input costs.
Net debt stood at ₹23,317 crore, down ₹2,553 crore year-on-year, and more than $800 million lower when adjusted for perpetual bonds. Net working capital increased to 116 days from 107 days a year ago.
Regionally, growth was led by Europe, up 21%, and Rest of the World, up 32%, with continued momentum in India and the Americas.
The company maintained its FY26 guidance of 4-8% revenue growth and 12-16% EBITDA growth.
Among platforms, Advanta delivered strong growth of 22%, the crop protection segment rose 8% on higher volumes, while specialty chemicals surged 42%.
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