Top 3 specialty chemical stocks to buy: Here are Motilal Oswal’s picks

Here are 3 of Motilal Oswal Top specialty chemical stock picks ,

Vinati Organics (VO): “Veeral Organics Pvt. Ltd. (VO’s wholly owned subsidiary) is also set to commence production of MEHQ, Guaiacol and Iso Amylene in 1HFY24E, which should take VO to the next level of its growth story,” said the brokerage Note highlighted.

Veeral Additives will start production of AO from Butyl Phenol, thus further integration, it said. “The stock is trading at 36x FY24E EPS and 28x FY24E EV/EBITDA with a return ratio of 22-25%. We value the company at 45x FY24E EPS to reach our target price 2,680,” it added. Vinati Organics is a leading manufacturer of specialty chemical and biological intermediates.

Nozzle: NOCIL evaluates its plans for the next three to five years, even as debottlenecking of its existing units is expected in the near term. Domestic tire companies plan to increase production with planned capital expenditure 200b over the next three years, said Motilal Oswal while maintaining buy rating on Nosil shares with target price (TP) 319 each. NOCIL is a leading Rubber Chemicals Manufacturer in India.

Galaxy Surfactants (GALSURF): The capital expenditure guidance of a particular chemical manufacturer was as follows 1.5 b each for FY23/FY24, same as FY22. The products are expected to expand across the board, but will primarily focus on specialty care products, according to the brokerage.

“The stock is currently trading at 35x FY24E EPS and 23x FY24E EV/EBITDA. We value the company at 45x FY24 EPS, or INR89, to arrive at our target price of 4,000 with a buy tag,” suggests Motilal Oswal. Galaxy Surfactants is one of the leading surfactant manufacturers in India and specialized chemicals for the cleaning and personal care space.

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

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