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Indian specialty chemicals companies are poised to ride tailwinds from macro drivers including ‘China+1’, import substitution, growing costs within China (capital, operational, compliances) and currency benefits, analysts at Kotak Institutional Equities said.
The brokerage firm has initiated coverage on specialty chemicals companies at a time of exciting visibility on sector opportunities across the next decade. Its top stock picks include Aarti Industries, Vinati Organics, PI Industries and SRF.
It has initiated coverage on specialty chemicals space with a Buy rating on Aarti (FV: ₹1,080, upside: 18%), Vinati (FV: ₹2,200, Upside: 19%) and Add rating on Atul (FV: ₹10,000, Upside: 5%), while it initiates with a Reduce rating on Clean Science and NFIL as it awaits a correction in valuations. Kotak retains its Add rating on PI (FV: ₹3,500, Upside: 9%) and SRF (FV: ₹12,000, Upside: 9%).
It finds Aarti among the most scalable chemical companies given its presence across basic-to-specialty products, favorable macro factors like depreciation of INR versus RMB, import substitution and ‘China+1’ support overall growth.
The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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