Chemical stocks hit new record highs, deliver multibagger returns in 2022 so far

Deepak Fertilizers Registered more than three times jump in consolidated net profit On strong sales compared to Rs 435.6 crore in Q1 ended June 130.6 crore in the year-ago period.

The total income of the company has increased by more than 59% 3,042 crore in the April-June period as against 1,908 crore in the same quarter last year. expenditure was high 2,392.8 crore during Q1 FY23 as compared to 1,717.5 crore year-on-year (YoY).

Its operating EBITDA margin increased to 24.3% in Q1 FY23 from 15.2% in Q1 FY22. The company said its strong top line growth and margin growth is primarily driven by the chemical segment.

Deepak Fertilizers Chairman and Managing Director (CMD) Shailesh C Mehta said the company’s long-term growth is expected to be driven by changes in product mix, better operational management and head room availability of additional capabilities emerging from de-bottlenecking. Greenfield expansion.

“We believe there is a healthy moderation in the spreads in subsequent quarters and a peak net debt of Rs 33 billion as of March-23. However, should the current spreads be sustained, the peak net debt could be lower as our FY23 EBIDTA There could be 3-4bn upside risk to the estimates. At just 10x FY24ii P/E, we find the stock undervalued. Commissioning of Ammonia and TAN projects will boost medium term growth,” said brokerage house IIFL Deepak said in a note on Fertilizers after the Q1 results.

Deepak Fertilizers and Petrochemicals Corporation Limited (DFPCL) is one of the leading producers of fertilizers and industrial chemicals in India. Deepak Fertilizers gave share multibagger returns More than 107% so far in 2022 (YTD), meanwhile the chemical stock is up about 72% in the one-year period.

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