GNFC - Attractive valuations; maintain Buy - EMkay

Reco: BUY
CMP: Rs 83
Target Price: Rs 105

- Q2FY13 results were broadly in line with est. GNFC reported revenues of Rs 11.7bn, 14% yoy, EBITDA of Rs 1.5bn, -2% yoy & PAT of Rs 724mn, -11% yoy

- Fertiliser performance remained muted. GNFC reported fert revenues of Rs 6.9bn, 14% yoy (est of Rs 7.9bn) due to lower volumes. EBIT margins stood at 2.4%(-50bps yoy/610bps qoq)

- Chemicals performance remained satisfactory. Company reported chemicals revenues of Rs 4.5bn, 14% yoy with margins of 19.3% (-460bps yoy/192bps qoq)

- GNFC continues with its Rs 42bn capex which is likely to be completed by FY13 end. Maintain Buy with target of Rs 105. At CMP, stock trades at 3.4x FY14 earnings/60% disc to BV.

Source : Equity Bulls

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