Accumulate Navin Fluorine International; target of Rs 4144: Prabhudas Lilladher

About this update from Navin Fluorine International Limited

Prabhudas Lilladher's research report on Navin Fluorine InternationalNavin Fluorine International (NFIL) reported a revenue of Rs5.2bn (-13.6% YoY/ 20% QoQ). The topline was 21% lower than our estimates of 6.6bn (Cons est. 5.4bn). Revenue growth was seen in the HPP vertical which saw 66% YoY increase, this growth was driven by stable HFO operations and strong sales of the new R32 capacity. The expansion of R-32 capacity is on track and is expected to commission in Feb’25. Specialty chemical vertical saw a 30% decline in sales due to inventory level realization. Gradual recovery is expected in H2FY25, but meaningful recovery to come only in FY26. The company signed a supply agreement for a patented agrochemical product for Japanese market with revenue potential Rs200¬300mn from CY25. CDMO vertical saw 13% YoY decline in revenue but saw a 69% sequential increase. Order visibility is improving for this vertical, phase 1 of cGMP4 plant is on track and is expected to commission by end of CY25. We cut our FY26 estimates by ~4% due to continued weakness in specialties segment, ~80% of which is agrochem which is not expected to recover before H2FY25.OutlookThe stock is currently trading at 53x FY26E EPS of Rs71. We value the company at 58x FY26E EPS to arrive at our TP of Rs 4,144. We maintain Accumulate on the stock.For all recommendations report, click hereDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Navin Fluorine International - 010724 - prabhu

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