Prabhudas Lilladher has set a price target of Rs 4,693 for Acutaas Chemicals, citing faster-than-expected growth in its contract manufacturing business. The company has raised its annual revenue guidance to 30%, though investors may monitor the impact of changes in its battery chemicals segment and the phase-out of low-value products.
Brokerage firm Prabhudas Lilladher has set a price target of Rs 4,693 for Acutaas Chemicals, following an upward revision in the company’s revenue guidance. The firm currently highlights the company’s progress in the Contract Development and Manufacturing Organization (CDMO) segment, which provides services for developing and manufacturing products for other companies.
Management has accelerated its revenue goal for the CDMO segment, aiming to reach INR 10 billion by fiscal year 2027, one year earlier than previously planned. The company projects further growth in this area, with an expectation to double CDMO revenue by fiscal year 2030. This optimism is based on the upcoming commercial launch of four new CDMO molecules in the second half of fiscal year 2027 and the steady growth of existing contracts like the Fermion project.
Recent financial results show the company achieved a consolidated revenue of INR 4.4 billion, which is a 43% increase compared to the previous year. However, the performance across different business segments was mixed. The specialty chemicals division saw a 20% contraction. According to management, this decline was a planned move to phase out low-value products, with the intention of replacing them with items that offer higher profit margins over time.
Another segment to track is Battery Chemicals (BFC). This division faced temporary difficulties during the recent period, linked to ownership changes at customer accounts in the United States. While the company has raised its overall annual revenue growth guidance to 30%, up from the previous 25% target, the final outcome will likely depend on how effectively it manages these segment-specific challenges.
Regarding profitability, the company maintains a projected EBITDA margin—a key measure of operating profit—between 38% and 40%. The brokerage's valuation of the stock is based on estimates for earnings per share looking toward fiscal year 2028 and beyond. Investors tracking the stock may look for updates on the launch schedule of the four new molecules and signs of stabilization or recovery in the battery chemicals segment, as these will influence whether the company can maintain its current margin and growth targets.