Analysts reiterate confidence in Rallis India post Q1 results
A favorite agrochemical stock for analysts, Rallis India, released its Q1 results, reporting a decline of -1% YoY in revenues in the first quarter of the new financial year, with numbers hit by the GST rollout. The company said that the pesticide supply chain had thinned out stocks ahead of GST. As predicted however, the company's seed business Metahelix saw strong recovery in this quarter from a weak Q4FY17, growing 13% YoY in revenue and 27% YoY in profits before tax. Two consecutive weak monsoons in the last two years have impacted Rallis. The stock is expected to closely track monsoon performance this year, and early signals - increase in sowing, with a +8% growth in kharif sowing area, and increases in minimum support price for farmers - suggest positive movement for the coming quarter. HDFC Securities issued a new buy call on the stock, expecting a 17%+ upside in target price.25-07-2017
