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What is the story about?
Shares of Navin Fluorine International Ltd. are in focus on Tuesday, February 10, as analysts were largely positive on the stock as they raised their target prices, indicating an upside potential of up to 18%, post its third quarter earnings.
The company's third quarter profit after tax (PAT) increased 122% to ₹185 crore from ₹84 crore in the previous year. Its revenue increased 47% to ₹892 crore from ₹606 crore in the third quarter of the previous fiscal.
The company's earnings before interest, tax, depreciation and amortisation (EBITDA) increased 109% to ₹308 crore from ₹147 crore, while its operating margin expanded to 34.5% from 24.3% in the year-ago period.
The specialty chemicals segment was up 60% at ₹354 crore, high performance products (HPP) segment was up 35% at ₹412 crore and the contract development and manufacturing organisation (CDMO) segment increased 61% to ₹127 crore.
While Jefferies, Nuvama and UBS have 'buy' ratings on the stock, Citi has a 'sell' recommendation. All analysts have raised their target prices.
Jefferies
Jefferies has a 'buy' rating on the stock and has raised its price target to ₹7,800 per share.
It said the company's third quarter was a strong beat with EBITDA and PAT 16% and 14% ahead of Jefferies' estimates, respectively. The same was driven by specialty chemicals.
It said firm contract in CDMO, ramp-up of data centre cooling product and R32 capacity, provide visibility on strong earnings growth over FY27-28. Its net debt to equity was at 0.03x.
Jefferies has upgraded its earnings per share (EPS) estimates for FY27 and FY28 to 9% and 7%, respectively, projecting a 23% EPS compound annual growth rate (CAGR) over the period.
Nuvama
Nuvama has a 'buy' rating on Navin Fluorine with a target price of ₹7,653 per share.
It said the stellar quarter was backed by growth in all three segments, with specialty chemicals surpassing expectations in a challenging agrochemical industry.
As the third quarter beat all headline expectations, Nuvama's FY26, FY27 and FY28 estimates warrant an upgrade by 15%, 11% and 11%, respectively, given sustainable EBITDA margin expectations of 30% or more, the analyst said.
It added that growth levers remain solid across segments, while backward integration from AHF should be margin accretive with a solid long-term optionality from sunrise sectors.
UBS
The analyst has a 'buy' rating on the stock with a target price of ₹7,800 per share.
It said Navin Fluorine's third quarter witnessed robust growth and improved margins. It has a favourable outlook.
It too mentioned that all segments performed well, with specialty chemicals better than expectations.
UBS said capacity expansion will support medium to long-term growth. The company's management indicated steady annualise EBITDA margins of around 30%, supported by higher utilisation of existing facilities.
It said the fourth quarter momentum is expected to remain strong, benefiting from seasonal trends. FY26 margins are likely to be higher than the guided 30% level, it added.
Citi
Citi has a 'sell' rating on Navin Fluorine, with a target price of ₹5,500 per share.
It said Navin Fluprine's annual expansion in EBITDA margin has been driven by a combination of higher gross margins and operating leverage.
It mentioned that Navin Fluorine has commissioned multiple projects over the last three years such as the R31, HFO, Ag-chem, with its gross block increasing by over 4x compared to FY22. Some of these capacities have ramped up with restrictions expected to be ramped up over the next couple of days, Citi said.
That said, Navin Fluorine is up 57% in one year at 29 times its EV/EBITDA, most of this upside appears to be factored in, Citi added.
Of the 29 analysts that have coverage on the stock, 21 have a 'buy' rating, three have a 'hold' rating and five have a 'sell' rating.
Navin Fluorine shares ended the previous session 3% up at ₹6,610 apiece. The stock has gained 14.2% in the past month and 57% in the past year.
Also Read: Amber Enterprises Q3: Revenue, EBITDA beat estimates; exceptional items pushes PAT into loss
The company's third quarter profit after tax (PAT) increased 122% to ₹185 crore from ₹84 crore in the previous year. Its revenue increased 47% to ₹892 crore from ₹606 crore in the third quarter of the previous fiscal.
The company's earnings before interest, tax, depreciation and amortisation (EBITDA) increased 109% to ₹308 crore from ₹147 crore, while its operating margin expanded to 34.5% from 24.3% in the year-ago period.
The specialty chemicals segment was up 60% at ₹354 crore, high performance products (HPP) segment was up 35% at ₹412 crore and the contract development and manufacturing organisation (CDMO) segment increased 61% to ₹127 crore.
While Jefferies, Nuvama and UBS have 'buy' ratings on the stock, Citi has a 'sell' recommendation. All analysts have raised their target prices.
Jefferies
Jefferies has a 'buy' rating on the stock and has raised its price target to ₹7,800 per share.
It said the company's third quarter was a strong beat with EBITDA and PAT 16% and 14% ahead of Jefferies' estimates, respectively. The same was driven by specialty chemicals.
It said firm contract in CDMO, ramp-up of data centre cooling product and R32 capacity, provide visibility on strong earnings growth over FY27-28. Its net debt to equity was at 0.03x.
Jefferies has upgraded its earnings per share (EPS) estimates for FY27 and FY28 to 9% and 7%, respectively, projecting a 23% EPS compound annual growth rate (CAGR) over the period.
Nuvama
Nuvama has a 'buy' rating on Navin Fluorine with a target price of ₹7,653 per share.
It said the stellar quarter was backed by growth in all three segments, with specialty chemicals surpassing expectations in a challenging agrochemical industry.
As the third quarter beat all headline expectations, Nuvama's FY26, FY27 and FY28 estimates warrant an upgrade by 15%, 11% and 11%, respectively, given sustainable EBITDA margin expectations of 30% or more, the analyst said.
It added that growth levers remain solid across segments, while backward integration from AHF should be margin accretive with a solid long-term optionality from sunrise sectors.
UBS
The analyst has a 'buy' rating on the stock with a target price of ₹7,800 per share.
It said Navin Fluorine's third quarter witnessed robust growth and improved margins. It has a favourable outlook.
It too mentioned that all segments performed well, with specialty chemicals better than expectations.
UBS said capacity expansion will support medium to long-term growth. The company's management indicated steady annualise EBITDA margins of around 30%, supported by higher utilisation of existing facilities.
It said the fourth quarter momentum is expected to remain strong, benefiting from seasonal trends. FY26 margins are likely to be higher than the guided 30% level, it added.
Citi
Citi has a 'sell' rating on Navin Fluorine, with a target price of ₹5,500 per share.
It said Navin Fluprine's annual expansion in EBITDA margin has been driven by a combination of higher gross margins and operating leverage.
It mentioned that Navin Fluorine has commissioned multiple projects over the last three years such as the R31, HFO, Ag-chem, with its gross block increasing by over 4x compared to FY22. Some of these capacities have ramped up with restrictions expected to be ramped up over the next couple of days, Citi said.
That said, Navin Fluorine is up 57% in one year at 29 times its EV/EBITDA, most of this upside appears to be factored in, Citi added.
Of the 29 analysts that have coverage on the stock, 21 have a 'buy' rating, three have a 'hold' rating and five have a 'sell' rating.
Navin Fluorine shares ended the previous session 3% up at ₹6,610 apiece. The stock has gained 14.2% in the past month and 57% in the past year.
Also Read: Amber Enterprises Q3: Revenue, EBITDA beat estimates; exceptional items pushes PAT into loss
