Sumitomo Chemicals India Ltd. – Strong Parentage
Sumitomo Chemical India Ltd. (SCIL) is a subsidiary of Sumitomo Chemical Company Ltd. (SCCL), Japan, which is a diversified global chemical company.
- SCIL has 5 manufacturing facilities – 4 in Gujarat and 1 in Maharashtra – as well as 4 branches and 68 depots across India. The company has its spread across ~80 national locations and 2 international locations i.e., China and Vietnam.
- In FY17, SCIL acquired Excel Crop-care Limited (ECC), an existing listed company with 3 manufacturing facilities (2 in Gujarat and 1 in Dadra & Nagar Haveli) and 3 fully-equipped R&D centers.
- ECC was primarily a premium generic agrochemical manufacturing company with a focus on formulations and had facilities to manufacture both formulations and technical.
Valuation
The company’s strong parentage, wide distribution network, rising share of export revenue, and continuous product launches will help it to take a big leap further. At CMP, the stock trades at 35x FY24E EPS. We recommend a BUY rating in the stock with the target price (TP) of Rs.550, 42x FY24E EPS.
Other articles you may like
Post Views:
26
