This Multibagger Chemicals stock gets ‘Buy’ tag from Edelweiss Post Q3 results

With the business outlook improving in Q4 FY12, Edelweiss retains its ‘Buy’ recommendation multibagger stock, which has grown by over 380% in a span of one year, with a target price of 3,447 per share. The brokerage believes that with an encouraging outlook and higher realizations in Q4FY22, Gujarat Fluoro will likely surpass its FY22 estimates.

Non-availability of raw materials impacted the fluoropolymer business in the third quarter (Q3) while the fluorospecialty chemicals business was affected due to plant disruption during the quarter, the note highlighted.

“Management is confident of strong growth in earnings growth momentum as it addresses raw material issues in fluoropolymers and strong pricing environment for PTFE (up 20-25 per cent in Q4FY22) while caustic soda prices remain high. But has stabilized. The demand landscape for PTFE and fluoropolymers remains encouraging. GFL is expected to benefit from the proposed capacity expansion in these verticals in FY 2013,” Edelweiss’s note added.

In addition, Gujarat Fluoro is looking to reduce its debt driven by solid cash flow generation in FY12. The brokerage highlighted, it also expects to receive its advance from Inox Wind by June 2022, if it fails to obtain regulatory approval for the wind power plant.

Gujarat Fluorochemicals Limited (GFL) is an Indian chemical company with more than 30 years of expertise in fluorine chemistry. The specialty chemical stock has risen more than 13% so far in 2022 (year-to-date or YTD).

The views and recommendations given above are those of individual analysts or broking companies and not of Mint.