Fundamental Report Praj Industries Ltd

Outlook:

Praj is witnessing strong growth in its key segment Bio Energy in Domestic business, as government is pushing for ethanol blending from 10% to 20% in FY25, and Praj being a key player in Ethanol plant is going to be a beneficiary, the overall demand-supply gap of Ethanol, increased interest in grain based distilleries and decarbonisation impetus is auguring well for Praj along with development in other key verticals such as Biosyrups, High Purity gaining traction. Praj is a key beneficiary of multiple tailwinds from ethanol bleeding to bio energy. We expect a robust Revenue growth of 25% in Q4FY22 but margins are expected to fall due to high material cost, profit is expected to degrow 9% in this quarter, but seeing the long term growth visibility we recommend ACCUMULATE IN THE PRICE RANGE OF ₹340-355 on the company, valuing the company on 40x FY23 earning we recommend BUY for the target price of ₹420.

(E=Estimate)

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