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Gujarat Fluorochemicals Ltd.’s Q1 FY24 Ebitda at Rs 3.5 billion was down 24% YoY. It was impacted by:
decrease realisation for bulk chemical substances the place complete income loss flows all the way down to revenue earlier than tax, and
decrease fluoropolymers volumes which led to under-absorption of mounted prices.
Gujarat Fluorochemicals expects fluoropolymers volumes to normalise in This autumn FY24 and ref-gas income to recuperate in H2 FY24 on revival of R-125 exports to the U.S. (whereas bulk chemical substances worth restoration could take extra time as a consequence of extra capability).
Q1 FY24 displays underlying Ebitda for the corporate excluding the advantage of increased pricing of bulk chemical substances. Gujarat Fluorochemicals has emphasised incremental progress to be pushed by functions in new-age industries together with battery chemical substances, photo voltaic, inexperienced hydrogen and semi-conductors.
Firm has stalled capex by just a few quarters for brand spanking new fluoropolymers and polytetrafluoroethylene on weak demand and modular capex flexibility, and has put R-32 capex on maintain.
We’ve got lower our earnings per share estimates for FY24E / FY25E by 10-27% factoring-in decrease realisation for bulk chemical substances and lower in ref-gas volumes.
Accordingly, we have now lowered our goal worth to Rs 3,570 (earlier: Rs 3,950) – unchanged FY25E worth/earnings a number of at 25 occasions. Keep ‘Purchase’.
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