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Buy Kaveri Seeds; target of Rs 560: Motilal Oswal

Motilal Oswal is bullish on Kaveri Seeds recommended buy rating on the stock with a target price of Rs 560 in its research report dated August 11, 2022.

August 14, 2022 / 12:13 PM IST
 
 
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Motilal Oswal's research report on Kaveri Seeds

KSCL clocked a better operating performance in 1QFY23, led by gross margin expansion of 420bp YoY, as the company was able to maintain the cost of production similar to 1QFY22 levels. All seed categories registered a volume growth, with cotton/hybrid rice/maize/selection rice growing by 8%/6%/24%/15%. Realization took a hit across segments due to higher discounts offered in 1QFY23. We largely retain our FY23 earnings estimate while we cut FY24 earnings estimate by 8% due to lower cotton seed sales volumes. We value the stock at 11x FY24E EPS to arrive at our TP of INR560 and maintain our Buy rating.

Outlook

We largely retain our FY23 earnings estimate, while we cut our FY24 earnings estimate by 8% due to lower cotton seed sales volumes to 6.3m from 7m packets. We value the stock at 11x FY24E EPS to arrive at our TP of INR560 and maintain our Buy rating.

For all recommendations report, click here

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Kaveri Seeds - 120822 - moti

Broker Research
first published: Aug 14, 2022 12:13 pm

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