Ami Organics - Fermi-ON: HDFC Securities

HDFC Securities Institutional Equities

We upgrade Ami Organics Ltd. to Buy from Add with a target price of Rs 1,600, owing to-

1. ramp-up in Fermion contract in ensuing quarters,

2. expansion of its specialty chemicals portfolio with entry into battery chemical manufacturing, and

3. balance sheet turning net cash of Rs 3.85 billion in Q1 FY25.

The stock is currently trading at 42/28 FY25/26E earnings per share. We expect the Ebitda margin to improve by 508bps from 17.9% in FY24 to ~23% in FY26E, owing to-

1. an increase in better-margin CDMO contribution to 25% from 12% in FY24 and

2. a ramp-up in capacity utilisation of speciality chemicals plant and advanced pharmaceutical intermediates units.

We expect Ami Organics’ PAT to grow at a 38% CAGR over FY24-26E, led by a 29% CAGR in Ebitda.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.