Hold Jubilant Ingrevia; target of Rs 649: Prabhudas Lilladher

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • Specialty Chemicals growth: Driven by volume growth in Fine Chemicals and agro CDMO contracts, with a pipeline of 25+ confirmed molecules having a revenue potential of INR15bn.
  • Nutrition segment expansion: 50% YoY revenue growth driven by higher Niacinamide volumes, with EBITDAM expanding 180bps YoY.
  • Chemical Intermediates improvement: 24% YoY revenue growth with EBITDAM improving to 11.4% from 4.4% in Q2FY26, supported by steady volumes and improved realizations.
  • Management guidance: FY27 EBITDA guidance of INR7.5-8.0bn maintained, with higher acetic acid prices expected to provide a near-term tailwind.

Thesis Validation Checklist

To validate the investment thesis, watch for:

  • Revenue growth: Continued growth in Specialty Chemicals and Nutrition segments.
  • Margin expansion: Improvement in EBITDAM driven by volume growth, improved realizations, and cost discipline.
  • Pipeline progress: Progress in the pipeline of 25+ confirmed molecules, with at least one-third expected to be realized in FY27.
  • Capex and expansion: Successful execution of capex plans, including the new MPP plant in Gajraula, and expansion into new areas like EDMS.