Buy Acutaas Chemicals; target of Rs 4693: Prabhudas Lilladher

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • Acutaas Chemicals' revenue growth is expected to be driven by a 53% YoY growth in Advanced Intermediates, supported by sustained CDMO momentum and healthy growth in the core advanced intermediates portfolio.
  • The company's EBITDA margin is expected to be 38-40% in FY27, driven by higher gross margins and operating leverage.
  • The CDMO business is expected to reach INR10bn in FY27, a year ahead of earlier guidance, and is anticipated to double by FY30.
  • The company's Battery Chemicals segment has started commercial revenue generation and is expected to contribute significantly to growth.

Thesis Validation Checklist

  • Investors should watch for the company's ability to deliver on its revenue growth guidance of 30% in FY27.
  • The ramp-up of the Fermion contract and commercialization of new CDMO molecules in H2FY27 will be key drivers of growth.
  • The company's ability to maintain its EBITDA margin and deliver on its capex plans will be important to monitor.
  • The growth of the Battery Chemicals segment and the contribution from new products will be key to the company's long-term growth outlook.