Indian chemical company shares jump after Norwegian govt fund buys stake
2 min read . Updated: 29 Nov 2022, 11:01 AM IST
Premium- As per NSE data, between November 22 to 28th, in a bulk deal, Norges Bank On Account Of The Government Pension Fund Global purchased 10.92 lakh equity shares at a price of ₹920 per share - aggregating to ₹100.46 crore.
Ami Organics, an R&D-driven manufacturer of specialty chemicals, rose by nearly 7% on Tuesday after the Norwegian Government Pension Fund Global picked up stakes worth more than ₹100 crore in the company. The smallcap stock was a couple of rupees away from crossing the ₹1,000 mark on NSE. On the back of a strong presence in high-growing and niche markets, Ami Organics is expected to continue to record better growth in a mid to long-term basis.
At around 10.35 am, Ami Organics stock was trading at ₹975.30 apiece up by ₹38.80 or 4.14% on NSE. The stock has touched an intraday high of ₹998.95 apiece -- resulting in an overall jump of 6.67% so far in the day.
On the previous day, Ami Organics stock was around ₹936.50 apiece on the exchange.
As per NSE data, between November 22 to 28th, in a bulk deal, Norges Bank On Account Of The Government Pension Fund Global purchased 10.92 lakh equity shares at a price of ₹920 per share --- aggregating to ₹100.46 crore.
During this period, SmallCap World Fund Inc sold 12.72 lakh equity shares at ₹920 per share --- amounting to ₹117.02 crore.
Last week, the company signed a definitive multi-year, multi-tonne agreement with Fermion, a fully owned subsidiary of Orion Corporation, Finland, for the supply of an intermediate for their patented product. The total minimum contract value is expected to be multi-million Euro, spread across a 10-year horizon. The product is expected to start contributing meaningfully to the revenue from FY24, as per the regulatory filing.
Ami Organics posted a consolidated net profit of ₹19.04 crore in Q2FY23 versus ₹17.47 crore in Q2 of the previous fiscal. Consolidated revenue from operations stood at ₹146.99 crore in Q2 of the current financial year compared to ₹122.31 crore in Q2FY22.
In its report dated November 16, Anand Rathi highlighted that during Q2, the company completed the development of Methyl salicylate and successfully erected a Flow reactor at Jhagadia plant which is expected to start production from Q3FY23. The company has also undertaken an increase in volume capacity by 3x. In its electrolyte additive, the company is expecting commercial trial orders in November 2022 and commercial orders to start from the first half of the calendar year 2023. The products are in various stages of qualification with customers in China, Korea, India, and Europe
Further, the company has also received a trial order for agrochemical intermediate and agrochemical intermediate product which is to get commercialized in Q3-FY23.
Also, the stock brokerage stated that Ami Organics' planned CAPEX of about ₹1,900 million in its intermediates business is progressing as per schedule and is in the civil construction stage with equipment ordering completed. The new facility is expected to be ready by December 2023. For the current financial year, the management has maintained the guidance.
On the stock valuation, Anand Rathi's note said, "with the presence in high growing and niche markets Ami Organics Limited is set to continue to post better growth in mid to long term. We have incorporated current financials and updated our numbers for the company. We continue to remain positive on the stock and maintain our BUY rating on the stock with a target price of ₹1,282 per share."
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
