Earnings Outlook: PI Industries net profit seen up 26%, sales up 33%

1 Aug 2022

PI Industries Ltd’s custom synthesis and manufacturing segment is seen aiding the topline and operating profit performance in the quarter ended June.

The company’s domestic agrochemical segment will likely have posted muted volume growth but price hikes may have led to a better revenue increase.

PI Industries’ net profit for the June quarter is seen at 2.3 bln rupees, up 26% on the year and its sales are expected to up by 33% at 14.8 bln rupees, according to an average of estimates by five brokerages.

Sequentially, the estimated net profit is up 13% and the estimated net sales is up 9%.

The company will declare its Apr-Jun results on Wednesday.

Brokerage Kotak Institutional Equities expects PI Industries’ revenue growth to be at 20% on the year lead by a 25% rise in custom manufacturing solutions segment and a 12% increase in domestic agri-input sales.

The custom synthesis and manufacturing segment’s revenue growth will likely have been “on the back of a strong order backlog and decent demand from the end industries,” said brokerage ICICI direct.com Research in its preview report.

PI Industries is seen having taken price hikes which would have offset definite input cost pressures.

“Though domestic margins may come under pressure, CSM (custom synthesis and manufacturing) margins are seen improving in FY 2023 (2022-23) as per management guidance,” said Kotak Institutional Equities.

Development of key molecules in pharma intermediates would be an important monitorable from PI Industries earnings, according to ICICI direct.com Research.