PI Industries Q2 Results Review - CSM Business Supports Operating Performance: Motilal Oswal

Motilal Oswal Report

PI Industries Ltd. continues to deliver modest growth amidst challenging business environment. Although demand is likely to be better for domestic crop protection and pharma business in H2, overall global industry challenges have tapered down the nearterm growth outlook for the company.

However, we still believe that PI has enough levers in place to deliver healthy growth in medium to long term, led by:

1. consistent growth momentum in the custom synthesis manufaturing business, driven by the rising pace of commercialisation of new molecules and a sale ramp-up in existing molecules;

2. product launches in the domestic market (six to seven new launches in FY25); and

3. ramping up of the pharma API and CDMO segments.

We expect a CAGR of 13%/16%/11% in revenue/Ebitda/adjusted profit after tax over FY24-27.

We reiterate Buy with a target price of Rs 5,200 (35 times on Dec-26 earnings per share).

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