Market share sacrificed for better margin

Company
11 Mar 2024
5 Min read 
  • Alkyl Amines (AACL) reported a 17% YoY decline in revenue in 3QFY24.
  •  The decline was primarily due to pricing pressure from Chinese suppliers.
  •  The company pushed for better margins in some products, resulting in improved PAT.
  •  The management expects the price correction due to Chinese suppliers to continue for another 6-12 months.
  •  AACL has applied for ADD on ACN and filed a fresh application for ADD on MIPA.
  •  Despite decent numbers in 3Q, revenue/EBITDA/EPS estimates have been cut for FY25 and FY26.
  •  The stock is trading at 60x FY25E EPS and 37.5x FY25E EV/EBITDA.
  •  The company has commissioned its Ethylamines capacity and is venturing into new specialty products.
  •  AACL is expected to have an ~8% revenue CAGR over FY23-26.
  •  The stock is rated as Neutral with a target price of INR2,125.
Login / Open Demat Account to read the report

Never Miss Out on Hot Market Updates

Get exclusive market news delivered to your inbox - on priority