K.P.R. Agrochem Limited (K.P.R) is an agri-input Company focused on
manufacturing, distribution and retailing of a wide range of crop yield enhancing
and protection products. It has 3 manufacturing facilities. Fertilizers segment
contributes around 60% of revenue, pesticides around 25% of revenue followed
by chemicals & seeds contributing 10% & 5% of revenue respectively.
Outlook & Valuation: At the upper end of the price band, K.P.R. demands PE
multiple of 17.6x of FY18 EPS. Coromandel International too trades at same PE
multiple compare with K.P.R. which is growing at faster rate compare to K.P.R.
Deepak Fertilizers & Petrochemicals and Chambal Fertilizer trades at PE multiple
6.5x & 14.4x of FY18EPS respectively. Considering all these, we have a NEUTRAL
view.
