Fine Organic Q1 Review: PL Capital Maintians 'Buy', Revises Target Price — Here's Why
PL Capital maintains ‘BUY’ rating and revises target price, valuing the stock at 33 times FY27E EPS.
(Representative image. Source: Envato)
In Q4 FY25, Fine Organic incorporated a wholly owned subsidiary in the USA to set up a manufacturing facility and enhance supply chain efficiency, alongside acquiring ~159.9acres of land in Jul’25.
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PL Capital Report
Fine Organic Industries Ltd. reported consolidated revenue of Rs 5.88 billion, up 7% YoY but down 3% QoQ. Export markets witnessed healthy demand growth during the quarter, while domestic demand remained stable. Raw material and freight prices also remained steady.
All manufacturing facilities operated at full capacity, except for the Patalganga (food-grade) plant, which is expected to be fully utilized by the end of FY26.
In Q4 FY25, Fine Organic incorporated a wholly owned subsidiary in the USA to set up a manufacturing facility and enhance supply chain efficiency, alongside acquiring ~159.9acres of land in Jul’25.
The company also secured environmental clearance (a few other approvals expected shortly) for its Rs 7.5 billion greenfield project on SEZ land. Construction is scheduled to begin soon and is expected to take 18 months from commencement.
We believe the new SEZ facility, and the planned US manufacturing plant will be key growth drivers. The SEZ plant is projected to deliver peak revenue potential of Rs 26 billion, based on an asset turnover of 3.5x, and is expected to contribute meaningfully to topline growth from FY28.
At the current valuation, Fine Organic trades at ~28x FY27E EPS.
We maintain our ‘BUY’ rating with a revised target price of Rs 5,610, valuing the stock at 33 times FY27E EPS.
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