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Morgan Stanley has an ‘overweight’ rating on the stock with a target of ₹3,000 per share, an upside of 58.3% from the previous closing price of ₹1,895 apiece. It says the phenolics business witnessed production outage of 12-15 Kt, which impacted the company’s costs.
The plant operations have stabilised this quarter, and the impact of higher imports are expected to normalise in March, it said.
The brokerage added that advanced intermediates are expected to meaningfully revive in the fourth quarter and sustain into the first and second quarters of the 2025-26 financial year. It said traction is being seen in both, domestic and international customers as well as new products. It added that full benefit of cost initiatives are filtering from the fourth quarter. The brokerage mentioned that the company’s upcoming projects have witnessed delays, with start-ups expected from FY26.
DAM Capital has a ‘buy’ call on the Deepak Nitrite stock with a target price of ₹2,142 per share, an upside of 13% from the previous day’s close.
It said the fourth quarter is to be significantly better than the third for the company’s AI business. Meanwhile, its phenolics business is likely to be impacted by higher imports in the fourth quarter and it expects to be normalised by the first quarter of FY26.The brokerage said the company has multiple projects to commission over the next two to three years. Also, its EBITDA margin accretion is set to pick up from the second half of FY26.
DAM Capital has cut the earnings per share for FY25E by 20%, for FY26E by 24% and for FY27E by 12%.
Deepak Nitrite recorded a weak performance in the December quarter, with its net profit plunging over 50% to ₹98 crore, its revenue dropping 5.3% to ₹1,903.4 crore, EBITDA declining 44.7% to ₹168.5 crore and margin contracting to 8.9% from last year’s 15.2%.
Deepak Nitrite shares remain in F&O ban.
The stock fell 1.99% to hit an intraday low of ₹1,860.65 per share in trade on Tuesday, February 18. The stock was trading 1.05% lower at ₹1,878.6 apiece at 10.50 am. It has fallen 20.36% in the past month.
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First Published: Feb 18, 2025 8:35 am IS
