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HDFC Securities Recommends Buying Navin Fluorine International with a Target Price of Rs 5368

In its research report dated October 5, 2023, HDFC Securities has expressed a bullish outlook on Navin Fluorine International Ltd (NFIL) and recommended a buy rating on the stock with a target price of Rs 5368.

The report highlights that Mr. Radhesh Welling, the Managing Director (MD) and Director of NFIL, has resigned from his position for personal reasons. His resignation will take effect from the close of business hours on December 15, 2023, and he will continue to serve the company during the transition period. The board is actively searching for an external candidate with the ability to handle large projects, possess execution skills, and technical expertise. In the interim, Mr. Vishal Mafatlal, the Executive Chairman, will oversee the company’s operations. Additionally, Mr. Sudhir Deo has been appointed as a non-executive non-independent director to further strengthen the board. Mr. Deo brings with him 44 years of experience, having retired as the Managing Director of NOCIL.

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The report anticipates that NFIL’s Profit After Tax (PAT) will grow at a compound annual growth rate (CAGR) of 30% over the period of FY23-26E, driven by a 33% CAGR in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). The buy rating is based on several factors, including the visibility of earnings due to long-term contracts in the specialty chemicals and High-Performance Polymers (HPP) segments, a shift in the sales mix toward high-margin, high-value businesses, and growth driven by capacity expansion.

Investors are encouraged to consider this research report when evaluating the investment potential of Navin Fluorine International Ltd. The report underscores the positive outlook for the company and its growth prospects, driven by various factors in the specialty chemicals and HPP segments.

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