Coromandel Q3 Results Review - Lower Subsidy Rates, Higher Raw Material Costs Weaken Margins: Motilal Oswal

Revenue declines due to reduced volumes and lower subsidy realisation.

<div class="paragraphs"><p>(Source:&nbsp;Coromandel International Official Website)</p></div>
(Source: Coromandel International Official Website)

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Motilal Oswal Report

Coromandel International Ltd.'s reported a weak operating performance (Ebitda down 54% YoY) led by lower margins in the nutrients and allied business (Ebit contribution: 71% in Q3 FY24), which declined 64% YoY.

This was due to a decline in subsidy rates (while MRP rates were stable), an increase in raw material prices, and a weak cropping season. The crop protection business (Ebit contribution: 29%) remained subdued, with an Ebit growth of 4% YoY.

Factoring in the weak Q3 FY24 performance, we cut our FY24E earnings by 13% while maintaining the earnings for FY25E/26E. Reiterate 'Buy'.

Click on the attachment to read the full report:

Motilal Oswal Coromandel International Q3 FY24 Results Review.pdf
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