Insecticides India gains 3% as govt grants patent for Substituted Pyrazole Derivatives

Shares of Insecticides India rose over 3 percent in early trade on June 7 after the government granted patent to the company for Substituted Pyrazole Derivatives, and Insecticides and Pesticides. The patent is granted for a period of 20 years from the date of filing, which was June 28, 2019.

At 12.33 pm, shares of Insecticides India were trading with gains of 2.42 percent at Rs 462.50 on the National Stock Exchange. The stock also touched an intraday high of Rs 467 earlier in the session.

Trading volumes were also high as one lakh shares changed hands on the exchanges as against the one-month daily traded average of 23,000 shares.

Also Read: Insecticides India tanks 6% on dismal Q4 performance

The stock has been on an upward trajectory for the past four sessions. Before a rebound made its way, the stock was sharply down last week on account of the company’s dismal performance in the quarter ended March.

The financials

In Q4, the agrochemical firm reported a consolidated loss of Rs 29.3 crore as against a net profit of Rs 22.30 crore in the same period during the previous fiscal. The company’s bottomline was weighed down by elevated input costs and a weak operational performance.

Revenue, however, grew 8.6 percent on year to Rs 302 crore as compared to the corresponding period of the previous year.

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What analysts have to say

Brokerage firm ShareKhan feels the sharp correction in the stock in 2023 so far factors in much of the margin pressure. “Ramp-up of new capacity and recovery in export revenue could drive earnings recovery from Q2FY24,” the firm said in its report. Accordingly, ShareKhan gave a ‘buy’ call for the stock with a target price of Rs 540.

Prabhudas Lilladher on the other hand, gave an ‘accumulate’ rating and also slashed its target price for the stock by over 15 percent to Rs 550. The firm cited passive demand environment coupled with near term margin pressure as reasons behind the cautious stance. Also, pricing in the company’s weak quarterly performance, Prabhudas Lilladher also trimmed its FY24/25E earnings estimates by 14 percent/9 percent.

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