Girish Pai

Nirmal Bang

Equity Bottom-Up

<p>4QFY21 Result Update</p>
<h2>PI Industries</h2>
<h3>Margin miss, M&amp;A delay cap stock - Retain Accumulate</h3>
<p>We maintain Accumulate on PI, post marginal changes in EPS estimates and increase in TP from Rs2426 to Rs2464. The 4QFY21 results were a miss at Gross/EBITDA margins, which dented the 9.6% beat on revenue. PAT was a marginal beat. The hit on margins was due to a) the cut in government’s export benefits under MIES; b) the change in product mix; c) the time, cost impact of stabilizing new launches/new plants…</p>

<p>3QFY21 Result Update</p>
<h2>PI Industries</h2>
<h3>Topline and margins support 9% beat on PAT</h3>
<p>We maintain Accumulate on PI Industries (PI) after raising our PE-based target price (TP) by 5.7% to Rs2,426 post 3QFY21 results, which was a beat vs. NB and street estimates. We have also raised our base case FY21E-23E EPS estimates based on the company’s guidance for higher margins. Our new TP is based on unchanged target PE of 34.7x on our pro-forma FY22E-23E average EPS estimate, assuming that potential earnings…</p>

<p>2QFY21 Result Update</p>
<h2>PI Industries</h2>
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<h3>Rich valuation offsets beat on results</h3>
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<p>We maintain Accumulate on PI Industries (PI) after raising our PE-based target price (TP) by 8.7% to Rs2168 post results, which was a beat vs. NB and street estimates. We have also raised our base case FY21E-23E EPS estimates based on the company’s guidance for higher margins. Our new TP is based on higher target PE of 34.7x (5% increase from our old PE of 33.2x) on our pro-forma FY22E-23E average EPS estimate, assuming…</p>
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<p>FY20 Annual Report Update</p>
<h2>PI Industries</h2>
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<h3>Dip in RoE offsets business and earnings growth outlook</h3>
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<p>PI Industries offers visible growth in topline and earnings from three new units started over 4QFY20 and 1HFY21 as per the Indian agrochem CSM leader’s FY20 annual report. The management has also discussed initiatives to beef up R&amp;D capabilities (i) to increase the pace of commercialization of molecules to at least 10 every year and (ii) new chemistry, including the latest in flourination…</p>
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<p>1QFY21 Result Update</p>
<h2>PI Industries</h2>
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<p><strong>Prospects hinge on RoE from QIP funded M&amp;A</strong></p>
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<p>We maintain Accumulate on PI industries (PI) after raising our PE-based target price (TP) by 18.2% to Rs1972 post results- in line vs. NB estimates, but above the street’s. We have also tweaked our base case EPS forecast to build in the 8.97% equity dilution post the recent QIP. Our new TP is based on 33x PE on our proforma FY22E-23E average EPS estimate assuming potential earnings from proposed investments…</p>
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India

PI Industries Limited manufactures agricultural and fine chemicals, and polymers. The Company produces fine chemicals; crop protection, plant nutrients, and seeds; and engineering plastics for use in the automobile, electrical, and home appliances industries.

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