Result Update

Institutional Research
India I Chemicals
30 April, 2024

Rossari Biotech BUY

Price: Rs749
Robust HPPC performance drives FY24 growth Target Price: Rs936
Forecast return: 25%

Rossari Biotech (Rossari) reported largely stable operating performance in Q4 with flattish Market Data
EBITDA and marginally lower bottom-line sequentially. YoY performance though remained Bloomberg: ROSSARI IN
robust with Revenues/EBITDA/PAT growth 16.3%/16.5%/17.8%. The company reported 52 week H/L: 904/657
good FY24 performance with YoY Revenues/EBITDA/PAT growth 10.5%/11.5%/21.8%. Market cap: Rs41.4bn
HPPC segment remained the key growth driver with 18.3% jump in FY24 revenues while Shares Outstanding: 55.2mn
TSC/AHN revenues declined 5.2%/14.0%. HPPC performance was robust despite weak Free float: 28.6%
agrochem performance amidst subdued to stable overall pricing environment. Institutional
Avg. daily vol. 3mth: 79,915
business almost doubled YoY in FY24 and management expects further doubling in FY25E. Source: Bloomberg
Management guided FY25E growth in early teens while growth rate to rise from FY26E post
~Rs1.3bn growth capex. We like Rossari due to consumption story driven by growth Changes in the report
visibility through ongoing capex. However, due to muted agrochem demand environment, Rating: BUY, unchanged
we have tweaked our FY25E/FY26E revenue estimates downwards by 1.8%/1.6% with Target price: Rs936, down 1.5% from Rs950
1.8%/1.4% downward revision in EPS. Based on our revised estimates, valuing the stock at FY25E: Rs28.1;down 1.8%
EPS:
26x FY26E EPS of Rs36.0, we maintain BUY rating with a revised TP of Rs936 (earlier Rs950). FY26E: Rs36.0; down 1.4%
Source: Centrum Broking
Robust HPPC drives Q4 performance
Shareholding pattern
During Q4, Rossari reported 16.3% YoY and 1.9% QoQ growth at Rs4.7bn. YoY growth was
Mar-24 Dec-23 Sep-23 Jun-23
driven by HPPC segment while QoQ growth was driven by TSC and AHN segments. Q4 EBITDA
Promoter 68.3 68.3 68.4 68.4
jumped 16.5% YoY while remaining flattish QoQ at Rs636mn and PAT surged 17.8% YoY while
down 0.8% QoQ at Rs341mn. FY24 revenue growth of 10.5% YoY was propelled by HPPC FIIs 4.0 4.1 5.7 6.1
segment revenues growing by 18.3% while TSC/AHN segment revenues declined 5.2%/14.0% DIIs 17.7 18.1 17.7 17.7
YoY. HPPC performance was driven by growth in home and personal care categories along Public/other 9.9 9.5 8.2 7.7
with significant growth in institutional business albeit agrochem remained muted. Source: BSE

Strong FY24 exports growth, further tapping newer geographies across HPPC/TSC segments Centrum estimates vs Actual results
During FY24, Rossari’s exports surged 18.0% YoY at Rs4.5bn constituting 24.5% of the overall YE Mar Actual Centrum Variance
revenues. Furthermore, during FY24, the company has set up a local team in Bangladesh to (Rs mn) Q4FY24 Q4FY24 (%)
cater to the textiles market which shall start yielding results from Q2FY25E onwards. Revenue 4,727 4,805 (1.62)
Additionally, the company is tapping Americas, MENA regions to expand its HPPC segment. EBITDA 636 632 0.62
Recently, Rossari has commercialised oilfield chemicals through which it expects to cater to EBITDA margin (%) 13.5 13.2 30bps
the Gulf as well as Indian market. These areas remain key growth drivers for exports growth. Adj. PAT 341 339 0.68
Source: Bloomberg, Centrum Broking
Capex on track, to aid growth in FY26E
Management remained upbeat on HPPC segment growth in FY25E albeit flattish agrochem
performance. TSC segment too shall start growing with renewed focus on Bangladesh while
margins and WC remain focal points for AHN segment. Rossari’s FY24 WC has stretched to
over 90 days primarily due to higher agrochem inventories and higher WC for institutional
business which has become a new normal now. We remain positive on the consumption
aspect of Rossari’s business. Significant capex in FY25E shall start reflecting in growth from
FY26E onwards along with operating leverage which can entail margin expansion. The stock
is currently trading at 26.7x/20.8x FY25E/FY26E EPS of Rs28.1/ Rs36.0. We continue to
maintain Buy on the stock with a marginally revised TP of Rs936 (earlier Rs950)

Risks – Delay in agrochem/ TSC recovery, margin pressure

Financial and valuation summary
YE Mar (Rs mn) 4QFY24A 4QFY23A YoY (%) 3QFY24A QoQ (%) FY24A FY25E FY26E
Revenues 4,727 4,065 16.3 4,638 1.9 18,306 20,667 23,794
EBITDA 636 546 16.5 637 (0.1) 2,498 2,917 3,485
EBITDA margin (%) 13.5 13.4 10bps 13.7 (20bps) 13.6 14.1 14.6 Rohit Nagraj
Research Analyst, Chemicals
Adj. Net profit 341 290 17.8 344 (0.8) 1,307 1,553 1,989
Chemicals

+91-022-4215 9645
Adj. EPS (Rs) 6.2 5.3 17.6 6.2 (0.8) 23.7 28.1 36.0 rohit.nagraj@centrum.co.in
EPS growth (%) 21.6 18.8 28.1
PE (x) 31.7 26.7 20.8
EV/EBITDA (x) 16.8 14.4 11.6
PBV (x) 4.0 3.5 3.0
Kunal Pai
RoE (%) 13.3 13.9 15.5 Research Associate, Chemicals
RoCE (%) 13.5 13.6 15.1 +91-022-4215 9018
kunal.pai@centrum.co.in
Source: Company, Centrum Broking

Please see Disclaimer for analyst certifications and all other important disclosures.
Rossari Biotech 30 April, 2024

Thesis Snapshot
Estimate revision Valuations
FY25E FY25E FY26E FY26E We like Rossari due to consumption story driven by growth visibility.
YE Mar (Rs mn) % chg. % chg.
New Old New Old However, due to muted agrochem demand environment, we have tweaked
Revenue 20,667 21,032 (1.8) 23,794 24,172 (1.6) our FY25E/FY26E revenue estimates by 1.8%/1.6% with 1.8%/1.4%
EBITDA 2,917 2,963 (1.6) 3,485 3,523 (1.1) downward revision in EPS. The stock is currently trading at 26.7x/20.8x
EBITDA margin 14.1 14.1 - 14.6 14.6 - FY25E/FY26E EPS of Rs28.1/ Rs36.0. Based on our revised estimates, valuing
the stock at 26x FY26E EPS of Rs36.0, we maintain BUY rating with a revised
Adj. PAT 1,553 1,577 (1.6) 1,989 2,015 (1.3)
TP of Rs936 (earlier Rs950).
Diluted EPS (Rs) 28.1 28.6 (1.8) 36.0 36.5 (1.4)
Source: Centrum Broking Valuations Rs/share
FY26E EPS 36.0
Rossari Biotech versus NIFTY Mid Cap 100 Target multiple (x) 26.0
1m 6m 1 year Target Price 936
Rossari in equity 10.7 1.4 9.1 CMP 749.3
NIFTY Mid Cap 100 5.8 30.8 60.0 Upside/ (downside) 24.9
Source: Bloomberg, NSE
P/E mean and standard deviation
Key assumptions 90
Y/E Mar FY25E FY26E
Revenue growth (%) 70
12.9 15.1
Gross margins (%) 29.3 29.7
50
EBITDA margins (%) 14.1 14.6
Source: Centrum Broking
30

10
Nov-21

Jun-23
Dec-22

Mar-23

Oct-23
Apr-21

Feb-22

Sep-22
May-22

Apr-24
Aug-21

Jan-24
P/E Mean
Mean + Std Dev Mean - Std Dev

EV/EBITDA mean and standard deviation

52
42
32
22
12
2
Jun-23
Nov-21

Dec-22

Oct-23
Apr-21

Feb-22

Sep-22
May-22

Apr-24
Aug-21

Mar-23

Jan-24

EV/EBITDA Mean
Mean + Std Dev Mean - Std Dev
Source: Bloomberg, Centrum Broking

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Rossari Biotech 30 April, 2024

Peer comparison
Mkt Cap CAGR (FY23A-26E) P/E (x) EV/EBITDA (x) ROE
Company
(Rs bn) Sales EBITDA EPS FY24A FY25E FY26E FY24A FY25E FY26E FY24A FY25E FY26E
Aarti Industries 269.3 10.1 19.8 22.1 70.1 35.6 27.1 29.9 20.1 16.3 7.5 13.4 15.5
Anupam Rasayan 91.2 12.0 13.8 18.6 63.3 41.9 29.6 24.1 19.0 14.5 5.5 7.1 9.4
Atul 176.5 6.9 12.8 9.5 47.7 34.0 26.2 26.2 19.6 15.7 7.6 9.9 11.8
Deepak Nitrite 332.0 11.7 23.4 23.8 42.6 26.4 20.5 28.9 17.6 13.6 17.5 23.5 24.5
Dhanuka Agritech* 63.7 10.2 14.5 10.3 26.9 23.5 20.3 19.3 16.8 14.3 20.5 19.9 19.7
Galaxy Surfactants 92.7 1.5 1.1 (0.4) 31.3 26.8 24.4 18.7 16.2 14.5 14.7 15.2 14.8
Gujarat Fluorochem 395.5 16.2 5.6 1.1 89.9 43.9 29.3 42.5 25.7 18.1 7.7 14.2 18.2
Navin Fluorine 169.7 17.8 16.2 13.1 77.9 42.7 31.2 43.7 27.4 21.1 9.4 15.3 18.0
PI Industries* 552.3 17.5 18.8 16.0 34.1 31.8 28.9 26.5 23.8 20.1 20.6 18.6 17.4
Rossari Biotech 41.3 12.8 16.0 22.8 31.7 26.7 20.8 16.9 14.4 11.6 13.3 13.9 15.5
SRF 778.1 6.2 7.8 5.0 61.8 40.9 31.0 32.0 23.3 18.5 11.6 15.6 17.7
UPL * 380.1 (3.0) (3.6) (4.5) - 25.3 11.7 12.9 7.5 5.7 (3.0) 5.2 10.5
Vinati Organics 170.0 9.3 5.9 3.6 54.6 41.0 33.0 37.7 28.8 23.4 13.1 15.4 16.7
Source: Company, Centrum Broking; *(YoY relevant)

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Rossari Biotech 30 April, 2024

Q4FY24 concall highlights

Similar to FY24 growth in FY25E, major fillip in FY26E from new
capex, WC stretched to 90 days
Financial performance – WC stretched, new normal at ~90 days
 FY24 Exports – 24% of revenues, one of the drivers being surfactants for food
processing for the US market
 Q4 Revenue segmental breakup – HPPC 73% / TSC 20% / AHN 7%
 FY24 Revenue segmental breakup – HPPC 73% / TSC 19% / AHN 8%
 Gross margins – Lower by 200bps QoQ in Q4, lower due to moderation in selling prices
of some product + change in product mix, High margin tender business in Q3, and
steady at ~29% in FY24, new normal
 WC – Stretched at 90 days in FY24, Rs200mn stock kept as inventory for agro in FY24,
Rossari Standalone WC normal at 70days
 FY24 – Non-agro: agro in Unitop at 50:50
 FY23 – Non-agro: agro in Unitop at 35:65
 Gross margins – 30% considered as stable going forward

Business performance – Growth across HPPC except agrochem

 TSC FY24 – 5% YoY volume growth
 TSC Q4 – 10% QoQ volume growth
 Strong growth in exports
 Subdued demand in Textile industry in Q4 with steady volumes but prices softened
 Inventories and receivables increased during FY24
 Inventories high due to stocking of products in March for agro demand in the coming
times as Rossari faced shortages last year
 Ethylene Oxide availability – Reliance to give 60% of EO normal requirement for April
and May, already built up stocks to meet demands so no impact on business
 Receivables high – Due to increase in credit days + due to poor agro season last year +
generally payment cycle getting stretched
 Institutional business heavy on the WC + cash intensive however will give good returns
once it crosses ~Rs8bn, bullish on the institutional business for the next 2-4 years
 Institutional business (IB) FY24 – Rs1.59bn revenues at 4% EBITDA, doubled YoY, WC at
85-90 days
 Non Agro business – Home care, Personal care, and paints & coatings which have
performed extremely well in FY24
 Oil field chemicals – Targeting India and Gulf markets + markets in Singapore and
Malaysia
 Gulf areas including Russia, India, Qatar, Saudi, Oman, UAE
 HPPC areas of focus for export growth – Americas including Latin and South America +
Asia (MENA region) + European geographies
 Tristar and Unitop have achieved 100% utilisation due to exports demand
 Growth driven by non-agro surfactants, phenoxy series products in both domestic and
exports market, robust growth in performance additives on a smaller base
 Institutional business experienced fastest growth, followed by non-agro surfactants
 Customer base expanded for key HPPC products

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Rossari Biotech 30 April, 2024

 AHN – Revenue was expected to be 2x YoY in FY24 however missed target due to
industry suffered from headwinds and company deliberately reduced its exposure to
AHN to avoid payment delays

Capex – On schedule, to benefit growth from FY26E

 Capex coming in phases from end-Q2/early-Q3, full benefit from FY26E
 Asset turn at Unitop and Tristar to be 4-5x
 New capex ramp up expected in FY26E with concurrent growth
 Expansion in Dahej facility to help in meeting growing demand in all the segments
 Putting up a premix plant and granulation facility to improve quality of products

Outlook – TSC growth from Bangladesh from Q2FY25E, to

double institutional business YoY in FY25E
 Major bump up in exports to come from FY26E
 FY25E revenue growth – Early teens, similar to FY24 growth rate
 Anticipate rebound in TSC and AHN demand in near future
 Q2FY25E onwards to see good ramp up in the Bangladesh business
 Target to double the Institutional business again in FY25E
 Capex will come in Unitop and will help in Ethoxylation and bolster the Oil and Gas
segment as well which will help HPPC segment growth
 Should be able to maintain volumes in FY25E on the back of good enquiries and order
book

Centrum Institutional Research 5

Rossari Biotech 30 April, 2024

Q4FY24 snippets from presentation

Stable sequential performance during Q4
Financial performance – Consistent growth trajectory over the
past four years
 Highest quarterly EBITDA – Supported by stable RM prices and growth in revenues
 FY24 Net debt to Equity – 0.03
 FY24 ROCE – 21%
 FY24 ROE – 13%
 FY24 Exports – Rs4.48bn (24%) vs Rs3.80bn
 Revenue CAGR over past four years – 37%
 EBITDA CAGR over past four years – 26%
 Consistent growth trajectory over the past four years, driven by both organic and
inorganic growth strategies
 Near-term investments and strategic initiatives have led to a moderation in ROCE and
ROE
 Balance sheet position remains strong
 Unitop FY24 revenues – Rs6.51bn, up 18% YoY with a CAGR of 20%
 Tristar FY24 revenues – Rs2.53bn up 21% YoY with a CAGR of 34%
 Buzil FY24 revenues – Rs1.59bn, up 101% YoY with a CAGR of 37%

Segmental performance – Robust HPPC performance

contributes to growth
 HPPC – Rs3,447mn, up 30.0 % YoY, delivered robust performance underpinned by
significant contributions from specialty surfactants, Phenoxy series, institutional
cleaning, performance chemicals
 TSC – Rs940mn, down 4.6%YoY, up 12.7% QoQ, due to price softening
 AHN – Rs340mn, down 20.0% YoY due to industry headwinds, up 36.0% QoQ
 Q4 revenue Mix – HPPC 75%, TSC 19%, AHN 6%
 The AHN segment made a strong QoQ recovery of 36% from Q3FY24
 Performance was largely driven by the expansion in HPPC business.

Business highlights
 Q4 performance is primarily attributed to the healthy growth witnessed in HPPC
division, HPPC achieved a robust improvement of 18%
 Increased customer base for key products which led to growth during the year
 registered a strong performance in export markets by targeting new customers in both
new and existing geographies
 A subdued performance from TSC segment due to the industry headwinds and AHN
segment due to seasonal softness
 Rossari are optimistic about recovery in these divisions in the coming quarters

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Rossari Biotech 30 April, 2024

Outlook
 Particularly focused on areas like specialty surfactants, Phenoxy series, institutional
cleaning, performance chemicals etc.
 Plan remains to tap into global markets with existing and new products, spread into
newer geographies, and increase wallet share with existing partners
 Emphasis on R&D remains a pivotal aspect of the Company’s growth and innovation
strategy
 The Company anticipates reporting sustained profitability in the upcoming quarters,
backed by improving capacity utilization levels
 Looking at tapping newer geographies and markets in TSC segment
 Achieved substantial success in Institutional Cleaning segment, which is expected to be
an important growth vertical moving forward

Capex – Capexes on track to be commissioned by FY25E

 In Q2FY24, announced an expansion of facility at Dahej, to foray into products related
to HPPC in the specialty chemical space, as well as for producing ingredients for
subsidiary companies
 In addition, to cater to the growing demand in agro chemicals, home and personal care,
oil & gas and the pharma sector, company had further announced expansion of the
Ethoxylation capacity at the Dahej facility of Unitop Chemicals
 Work on both these projects has started and is going as per schedule, commissioning
is expected to happen, in a phased manner, by FY25E

Centrum Institutional Research 7

Rossari Biotech 30 April, 2024

Exhibit 1: Quarterly Review (Cons.)

Y/E March (Rs mn) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 % chg.
Net sales 4,727 4,065 16.3 4,638 1.9 18,306 16,559 10.5
Cost of Goods 3,383 2,863 18.2 3,230 4.7 12,935 11,710 10.5
% of sales 71.6 70.4 69.6 70.7 70.7
Employee benefit expenses 250 268 (6.5) 260 (3.8) 1,031 986 4.6
% of sales 5.3 6.6 5.6 5.6 6.0
Other expenditure 458 388 17.9 511 (10.3) 1,853 1,632 13.5
% of sales 9.7 9.6 11.0 10.1 9.9
Operating profit 636 546 16.5 637 (0.1) 2,486 2,230 11.5
OPM (%) 13.5 13.4 13.7 13.6 13.5
Dep. and amor. 161 160 0.4 151 6.5 604 629 (4.0)
EBIT 475 386 23.2 486 (2.2) 1,882 1,601 17.5
Interest 25 43 (41.9) 43 (41.6) 182 223 (18.5)
Other income 4 28 (86.1) 35 (88.9) 74 55 35.8
Excp. Item 2 2 (10.2) 0 820.0 2 10 (81.7)
PBT 456 372 22.4 478 (4.6) 1,776 1,442 23.2
Provision for tax 114 83 38.6 134 (14.6) 469 370 27.0
eff. tax rate 25.1 22.2 28.0 26.4 25.6
PAT (rep.) 341 290 17.8 344 (0.8) 1,307 1,073 21.8
NPM (%) 7.2 7.1 7.4 7.1 6.5
EPS (Rs) 6.2 5.3 17.6 6.2 (0.8) 23.7 19.4 21.6

Segmental Breakup
Segment Sales (Rs mn) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 % chg.
HPPC 3,447 2,654 29.9 3,554 (3.0) 13,684 11,569 18.3
TSC 940 985 (4.6) 834 12.7 3,542 3,737 (5.2)
AHN 340 425 (20.0) 250 36.0 1,080 1,257 (14.0)
Total 4,727 4,064 16.3 4,638 1.9 18,306 16,563 10.5

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Rossari Biotech 30 April, 2024

Exhibit 2: Quarterly trend

Quarterly (Rs mn) Q4FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 YoY (%) QoQ (%)
Revenues 4,389 4,347 4,254 3,893 4,065 4,106 4,835 4,638 4,727 16.3 1.9
Q-o-Q gr. (%) 2.5 (1.0) (2.1) (8.5) 4.4 1.0 17.7 (4.1) 1.9
Raw Mat. Cons. 3,020 2,926 2,596 2,579 2,562 2,553 3,138 2,977 2,996 17.0 0.6
% of net sales 68.8 67.3 61.0 66.3 63.0 62.2 64.9 64.2 63.4
Purchase of prod. 224 181 422 145 301 342 289 253 387 28.4 52.8
% of net sales 5.1 4.2 9.9 3.7 7.4 8.3 6.0 5.5 8.2
Employee Costs 222 235 241 242 268 245 275 260 250 (6.5) (3.8)
% of net sales 5.1 5.4 5.7 6.2 6.6 6.0 5.7 5.6 5.3
Others 400 428 430 385 388 388 496 511 458 17.9 (10.3)
% of net sales 9.1 9.9 10.1 9.9 9.6 9.5 10.3 11.0 9.7
EBITDA 523 577 565 542 546 577 636 637 636 16.5 (0.1)
Q-o-Q growth (%) 11.9 10.4 (2.1) (4.2) 0.8 5.8 10.1 0.2 (0.1)
EBITDA Margin (%) 11.9 13.3 13.3 13.9 13.4 14.1 13.1 13.7 13.5
Dep. & Amor. 165 153 156 160 160 141 151 151 161 0.4 6.5
EBIT 358 424 409 382 386 436 485 486 475 23.2 (2.2)
Interest exp. 48 51 82 47 43 63 50 43 25 (41.9) (41.6)
Other Income 20 7 8 11 28 22 14 35 4 (86.1) (88.9)
Exceptional Items 13 6 1 0 2 -0 0 0 2 (10.2) 820.0
EBT 343 387 336 347 372 395 448 478 456 22.4 (4.6)
Provision for tax 102 100 97 90 83 102 119 134 114 38.6 (14.6)
Eff. tax rate (%) 29.7 25.9 28.9 25.9 22.2 25.9 26.5 28.0 25.1
Net Profit 241 287 239 257 290 292 329 344 341 17.8 (0.8)
Q-o-Q gr. (%) 6.8 19.1 (16.6) 7.4 12.8 0.8 12.8 4.4 (0.8)
PAT Margin (%) 5.5 6.6 5.6 6.6 7.1 7.1 6.8 7.4 7.2

Segment sales (Rs mn) Q4FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 YoY (%) QoQ (%)
HPPC 3,037 3,165 3,038 2,712 2,654 3,012 3,671 3,554 3,447 29.9 (3.0)
TSC 1,098 939 919 895 985 809 959 834 940 (4.6) 12.7
AHN 255 243 302 286 425 285 205 250 340 (20.0) 36.0
Total 4,389 4,347 4,259 3,893 4,064 4,106 4,835 4,638 4,727 16.3 1.9

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Rossari Biotech 30 April, 2024

P&L Balance sheet

YE Mar (Rs mn) FY22A FY23A FY24A FY25E FY26E YE Mar (Rs mn) FY22A FY23A FY24A FY25E FY26E
Revenues 14,830 16,559 18,306 20,667 23,794 Equity share capital 110 110 110 110 110
Operating Expense 11,050 11,713 12,935 14,607 16,732 Reserves & surplus 7,942 9,041 10,367 11,795 13,625
Employee cost 679 986 1,031 1,201 1,406 Shareholders fund 8,052 9,152 10,477 11,906 13,735
Others 1,266 1,629 1,841 1,942 2,171 Minority Interest 0 0 0 0 0
EBITDA 1,834 2,230 2,498 2,917 3,485 Total debt 84 739 1,058 1,058 758
Depreciation & Amortisation 481 629 604 765 823 Non Current Liabilities 879 102 149 149 149
EBIT 1,354 1,601 1,894 2,152 2,661 Def tax liab. (net) 689 587 515 515 515
Interest expenses 127 223 194 158 117 Total liabilities 9,705 10,581 12,199 13,628 15,157
Other income 120 55 74 82 115 Gross block 3,827 3,908 4,260 6,240 6,690
PBT 1,363 1,442 1,776 2,076 2,659 Less: acc. Depreciation (803) (1,208) (1,654) (2,222) (2,845)
Taxes 386 370 469 523 670 Net block 3,025 2,700 2,606 4,018 3,845
Effective tax rate (%) 28.3 25.6 26.4 25.2 25.2 Capital WIP 13 131 472 472 472
PAT 977 1,073 1,307 1,553 1,989 Net fixed assets 6,326 6,263 6,498 7,733 7,380
Minority/Associates 0 0 0 0 0 Non Current Assets 132 165 725 725 725
Recurring PAT 977 1,073 1,307 1,553 1,989 Investments 2 2 2 2 2
Extraordinary items 0 0 0 0 0 Inventories 1,899 1,885 2,823 2,782 3,187
Reported PAT 977 1,073 1,307 1,553 1,989 Sundry debtors 3,049 3,537 4,251 4,513 5,196
Cash & Cash Equivalents 524 1,239 302 558 1,714
Ratios Loans & advances 14 3 7 7 7
YE Mar FY22A FY23A FY24A FY25E FY26E
Other current assets 608 551 1,064 1,064 1,064
Growth (%) Trade payables 1,862 1,810 2,191 2,474 2,834
Revenue 109.1 11.7 10.5 12.9 15.1 Other current liab. 985 1,244 1,286 1,286 1,286
EBITDA 49.1 21.6 12.0 16.8 19.5
Provisions 16 41 45 45 45
Adj. EPS 15.4 9.6 21.6 18.8 28.1
Net current assets 3,231 4,119 4,926 5,119 7,002
Margins (%) Total assets 9,705 10,581 12,199 13,628 15,157
Gross 25.5 29.3 29.3 29.3 29.7
EBITDA 12.4 13.5 13.6 14.1 14.6 Cashflow
EBIT 9.1 9.7 10.3 10.4 11.2 YE Mar (Rs mn) FY22A FY23A FY24A FY25E FY26E
Adjusted PAT 6.6 6.5 7.1 7.5 8.4 Profit Before Tax 1,363 1,442 1,776 2,076 2,659
Returns (%) Depreciation & Amortisation 481 629 604 765 823
ROE 16.1 12.5 13.3 13.9 15.5 Net Interest 127 223 194 158 117
ROCE 17.3 13.7 13.5 13.6 15.1 Net Change – WC (676) (938) (1,806) 63 (728)
ROIC 10.6 12.7 11.7 12.3 14.8 Direct taxes (470) (491) (558) (523) (670)
Turnover (days) Net cash from operations 688 801 133 2,457 2,087
Gross block turnover ratio (x) 3.9 4.2 4.3 3.3 3.6 Capital expenditure (3,708) (224) (764) (2,000) (470)
Debtors 55 73 78 77 74 Acquisitions, net 0 0 0 0 0
Inventory 47 59 66 70 65 Investments (118) (144) (116) 0 0
Creditors 52 57 56 58 58 Others 120 55 74 82 115
Net working capital 80 91 98 90 107 Net cash from investing (3,706) (313) (806) (1,918) (355)
Solvency (x) FCF (3,017) 488 (672) 539 1,732
Net debt-equity (0.1) (0.1) 0.1 0.0 (0.1) Issue of share capital 3,022 50 0 0 0
Interest coverage ratio 14.5 10.0 12.9 18.4 29.8 Increase/(decrease) in debt 84 655 319 0 (300)
Net debt/EBITDA (0.2) (0.2) 0.3 0.2 (0.3) Dividend paid (28) (28) (28) (124) (159)
Per share (Rs) Interest paid (127) (223) (194) (158) (117)
Adjusted EPS 17.7 19.4 23.7 28.1 36.0 Others (443) (774) (413) 0 0
BVPS 146.2 165.9 189.7 215.5 248.6 Net cash from financing 2,509 (319) (315) (282) (576)
CEPS 26.5 30.9 34.6 42.0 50.9 Net change in Cash (508) 168 (988) 256 1,155
DPS 0.5 0.5 0.5 2.2 2.9 Source: Company, Centrum Broking
Dividend payout (%) 2.8 2.6 2.1 8.0 8.0
Valuation (x)
P/E 42.2 38.5 31.7 26.7 20.8
P/BV 5.1 4.5 4.0 3.5 3.0
EV/EBITDA 21.0 18.3 16.8 14.4 11.6
Dividend yield (%) 0.1 0.1 0.1 0.3 0.4
Source: Company, Centrum Broking

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Rossari Biotech 30 April, 2024

Disclaimer
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complete.

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Rossari Biotech 30 April, 2024

The opinions and projections expressed herein are entirely those of the author and are given as part of the normal research activity of Centrum Broking and
are given as of this date and are subject to change without notice. Any opinion estimate or projection herein constitutes a view as of the date of this report
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As per the declarations given by them, Mr. Rohit Nagraj & Mr. Kunal Pai, research analyst and and/or any of their family members do not serve as an officer,
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Ratings definitions
Our ratings denote the following 12-month forecast returns:
Buy – The stock is expected to return above 15%.
Add – The stock is expected to return 5-15%.
Reduce – The stock is expected to deliver -5-+5% returns.
Sell – The stock is expected to deliver <-5% returns.
Rossari Biotech
2000

1500

1000

500

0
Apr-21 Oct-21 Apr-22 Oct-22 Apr-23 Oct-23 Apr-24
Rossari Biotech Ltd

Source: Bloomberg

Centrum Institutional Research 12

Rossari Biotech 30 April, 2024

Disclosure of Interest Statement

1 Business activities of Centrum Broking Centrum Broking Limited (hereinafter referred to as “CBL”) is a registered member of NSE (Cash, F&O and Currency Derivatives
Limited (CBL) Segments), MCX-SX (Currency Derivatives Segment) and BSE (Cash segment), Depository Participant of CDSL and a SEBI registered
Portfolio Manager.
2 Details of Disciplinary History of CBL CBL has not been debarred/ suspended by SEBI or any other regulatory authority from accessing /dealing in securities market.

3 Registration status of CBL: CBL is registered with SEBI as a Research Analyst (SEBI Registration No. INH000001469)

Rossari Biotech

4 Whether Research analyst’s or relatives’ have any financial interest in the subject company and nature of such financial interest No

5 Whether Research analyst or relatives have actual / beneficial ownership of 1% or more in securities of the subject company at the end of the month
No
immediately preceding the date of publication of the document.
6 Whether the research analyst or his relatives has any other material conflict of interest No

7 Whether research analyst has received any compensation from the subject company in the past 12 months and nature of products / services for which
No
such compensation is received
8 Whether the Research Analyst has received any compensation or any other benefits from the subject company or third party in connection with the
No
research report
9 Whether Research Analysts has served as an officer, director or employee of the subject company No

10 Whether the Research Analyst has been engaged in market making activity of the subject company. No

11 Whether it or its associates have managed or co-managed public offering of securities for the subject company in the past twelve months; No

Whether it or its associates have received any compensation for investment banking or merchant banking or brokerage services from the subject company
12 No
in the past twelve months;
Whether it or its associates have received any compensation for products or services other than investment banking or merchant banking or brokerage
13 No
services from the subject company in the past twelve months;

Member (NSE and BSE). Member MSEI (Inactive)

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CDSL DP ID: 120 – 12200
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PORTFOLIO MANAGER

SEBI REGN NO.: INP000004383

Research Analyst
SEBI Registration No. INH000001469

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AMFI REGN No. ARN- 147569

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(022) 4215 9000/9023; Email ID: compliance@centrum.co.in

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Centrum Institutional Research 13