Navin Fluorine - CDMO To Be A Key Growth Driver: Dolat Capital

Dolat Capital Report

We visited Navin Fluorine International Ltd.’s contract development manufacturing organisation site at Dewas (Madhya Pradesh) which is spread over 47acres, of which-

1. ~45% area is houses CGMP I, II and III (total 220 KL), and ongoing expansion (CGMP IV – 250 KL);

2. ~30% is green belt while the remaining is available for expansion (it can double its capacity to ~1000 KL through addition of CGMP V & VI on remaining land).

CDMO has capex outlay of Rs 2.88 billion of which Phase 1 of ~Rs 1.6 billion is underway (to complete by November 2025) and Phase-II of ~Rs 1.3 billion is planned. Expected asset turnover is two times at optimal utilization.

Management expects CDMO revenues at ~Rs 8 billion in FY27, aided by Fermion master supply agreement, wherein its drug’s application expanded, driving higher revenue projections.

The company indicated revenue share of ~3% of the total, giving high revenue visibility. Another three-four projects with drugs over $1 billion revenue potential are underway.

Navin Fluorine is navigating challenges in the near-term, particularly in the specialty chemicals segment (pricing pressures; delay in commercialization).

Overall focus is on operational efficiency, innovation, and building a non-Chinese supply chain to remain competitive in global markets.

We trim our EPS estimates by 5%/7% for FY25/26 and retain ‘Accumulate’ rating with revised target price of Rs 4010 (earlier Rs 4060), as we roll to Dec-26.

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.