MOSL: PI INDUSTRIES (Buy)- Isagro Asia a good buy; Synergies in CSM and domestic formulations
PI INDUSTRIES: Isagro Asia a good buy; Synergies in CSM and domestic formulations
(PI IN, Mkt Cap USD2.5b, CMP INR1285, TP INR1459, 14% Upside, Buy)
PI Industries (PI) has acquired Isagro Asia for INR3.5b at a valuation of ~15x P/E FY19. PI should derive synergies from the acquisition in custom synthesis & manufacturing (CSM) and in the domestic formulation business. Key highlights of the deal:
Acquires Isagro Asia for INR3.5b
- PI Industries has announced the acquisition of Isagro Asia from Isagro S.p.A for INR3.5b. Isagro Asia operates in India and is engaged in contract manufacturing, local distribution and exports of agrochemicals.
- PI will acquire 100% shareholding held by Isagro S.p.A in Isagro Asia, either directly or through a subsidiary. The deal has taken place at a valuation of ~15x P/E FY19. PI will fund the acquisition partly through internal accruals and partly through debt.
- The proposed transaction is expected to be completed in 3QFY20, subject to finalization of definitive agreements, customary closing conditions and regulatory approvals. Company remains confident of integrating Isagro Asia's operations with itself in FY20.
PI Industries Limited is a holding company. The Company is engaged in the manufacturing and distribution of agro chemicals. Its geographical segments include Sales within India and Sales outside India. The Company manufactures agrochemicals, plant nutrients and plant protection, specialty fertilizers and hybrid seeds. It offers insecticides under various brands, including LEPIDO, DODGER, COLT, OSHEEN, COLFOS, FOSMITE, JUMBO, FORATOX, CARINA, MAXIMA and VIBRANT. The Company offers fungicides under brands, which include CUPRINA, LURIT, KITAZIN, SANIPEB, CLUTCH and LOGIK. It offers herbicides under the brands, including SOLARO, NOMINEE GOLD, INRO, BINGO, PIMIX, BUNKER and MELSA. Its specialty products include BIOVITA Granules and BIOVITA Liquid. The Company provides services in various areas, including contract research, process development, analytical method development, process safety data generation and process detailed engineering.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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