BASF India soars after domestic brokerage initiates coverage

BASF India rose 12.16% to Rs 1,649.80 at 11:22 IST on BSE on reports that a domestic brokerage firm initiated coverage on the stock with a 'buy' rating and a target price of Rs 2,212.

Meanwhile, the S&P BSE Sensex was up 216.65 points, or 0.69% to 31,808.68.

On the BSE, 24,000 shares were traded in the counter so far, compared with average daily volumes of 3,344 shares in the past one quarter. The stock had hit a high of Rs 1,702 and a low of Rs 1,530 so far during the day. The stock hit a record high of Rs 1,809.85 on 30 June 2017. The stock hit a 52-week low of Rs 988.50 on 21 November 2016.

The stock had underperformed the market over the past one month till 5 October 2017, falling 0.41% compared with 0.22% decline in the Sensex. The scrip had also underperformed the market in past one quarter, falling 13.17% as against Sensex's 0.74% rise. The scrip had outperformed the market in past one year, rising 21.70% as against Sensex's 12.40% rise.

The mid-cap company has equity capital of Rs 43.29 crore. Face value per share is Rs 10.

According to reports, the brokerage that substantial capital expenditure by BASF India will now reduce its reliance on imports. BASF India is poised to demonstrate strong recovery in net profit and return ratios. Return on capital employed is expected to rise to 22% in FY 2020, compared to 4% in FY 2017. Manufacturing and new product launches is expected to drive growth. The brokerage expects revenue and EBITDA to grow at CAGR of 14% and 39% respectively over FY 2017-2020 led by settlement of technical issues and enhanced capacity utilization.

Net profit of BASF India declined 93.07% to Rs 0.68 crore on 8.43% rise in net sales to Rs 1507.17 crore in Q1 June 2017 over Q1 June 2016.

BASF India, the flagship company of BASF in India, is a public limited company with 73.33% of the shares held by BASF SE. BASF India is engaged in providing chemicals, plastics, performance products and crop protection products.

Powered by Capital Market - Live News