|SummaryAt the CMP of `115.95, Rallis India is trading at 11.50x its FY13E earnings estimate. Currently, the sector is facing headwinds such as lower farmer sentiment and considerable inventory pileup putting pressure on margins. However, strong base business, continuous product launches and foray into newer segments lead us to believe the long term outlook for Rallis is still positive. Being an agricultural stock, rainfall is a crucial trigger for the stock.
We retain our BUY rating on Rallis with revised target price set to `150.17 based on a P/E of 15x FY13E EPS of `10, a potential upside of 29.52%.