Ami Organics Q1 Results Review - Subdued Quarter: IDBI Capital

IDBI Capital Report

Ami Organics Ltd. registered subdued performance in Q1 FY25. While revenue grew by 15% YoY, Profit after tax declined by 29% YoY. Gross margins stood at 42.1% as against 40% QoQ. Ebitda margins stood at 16.7% registering a sharp drop of 250 bps QoQ.

Lower Ebitda margins were on account of lower gross margins and higher employee expenses on account of annual increments and new hires for Ankleshwar plant.

Revenue growth was volume led as realisations remained stagnant. The API business is facing challenges due to oversupply issues on account of Chinese competition.

We believe current valuations factor in positives and hence retain our 'Hold' rating with revised target price of Rs 1,250 at 40 times FY26E earnings.

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