Navin Fluorine "firing up all cylinders," says HDFC Sec; retains 'Buy' call

Over the next three years, analysts expect the company's EPS to grow at a CAGR of 23 per cent, from ₹104 to ₹195

Analysts at HDFC Securities have retained their ‘Buy’ rating on Navin Fluorine International (NFIL), noting that the company is “firing up all cylinders.”

 

NFIL’s strategy is to deepen wallet share within its existing customer base by leveraging its established marketing network, broadening its product portfolio, and building on long-standing client relationships, which Nilesh Ghuge, Prasad Vadnere, and Dhawal Doshi, analysts at HDFC Securities, believe will help drive growth across all business verticals.

 

The brokerage has maintained its bullish stance with a target price of ₹7,000 per share, implying a PE ratio of 43.7x for FY28. The stock was trading at ₹5,791, up 0.32 per cent from its previous close, suggesting an upside of nearly 21 per cent from the current market price. 

 

CDMO business remains in focus

HDFC Securities highlights that the CDMO (Contract Development and Manufacturing Organisation) business continues to focus on select marquee global customers. The emphasis is on scaling revenues from commercial projects and late-stage molecules to secure more stable revenue streams, backed by sustained engagement with leading innovator pharma clients.

 

To further this, NFIL has commissioned a cGMP Phase 1 facility with a capital expenditure of ₹160 crore. The HPP (High Purity Products) business and Specialty Chemicals business will be driven by deepening relationships with existing customers and ramping up facilities. The changing dynamics of the global supply chain and incremental capex in the refgas business are expected to help ramp up the HPP business.

Growth across all business verticals

The analysts at HDFC Securities expect rapid growth in the company’s financials, driven by growth across all business verticals.   

“Revenue is expected to increase from ₹2,349 crore in FY25 to ₹4,833 crore in FY29, while Ebitda is projected to rise from ₹530 crore to ₹1,441 crore, with margins improving by 711 basis points to 29.8 per cent, supported by an inflection in the CDMO business and better realisations in the refgas business through backward integration in AHP,” the analysts said in a research note. 

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