Agrochemicals – Finding Silver Lining in a Dull Market

The third consecutive year of normal monsoon and higher price for food grains bodes well for agrochemical companies
Agrochemicals - Finding Silver Lining in a Dull Market
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Last year during the same period we were going through one of the worst phases of the economic downturn. This was due to the strict lockdown that we saw nationwide owing to the rising case of Covid-19. It impacted most sectors of the economy including agrochemicals; however, it was also the first few sectors in the economy that managed to return to normalcy much before many other sectors.

Sensing the opportunity, last year in our May Issue we did a Cover Story – “Where to Invest in Otherwise Shrinking Opportunities” about the agrochemical industry. That means in the same month. The Cover Story very clearly stated that it is AGRO that would provide solace in otherwise shrinking investing opportunities. We feel again the situation has come back to the same level.

Here is the list of the companies and the kind of return they registered.

Stock Name IE&M Recommended Price 

(April 30, 2020)

High after our recommendation Appreciation in % Last Trading Price (April 30, 2021) Appreciation in %
Shivalik Rasayan 277 853.95 208% 672.95 143%
Dhanuka Agritech 447 935.75 109% 766.35 71%
Chambal Fertilisers 129.5 267 106% 217.19 68%
Mahindra EPC Irrigation 101 194.5 93% 147.4 46%
Bharat Rasayan 6855 13198.9 93% 12100 77%
PI Industries 1590 2669 68% 2506.5 58%
UPL 420 674 60% 608.2 45%
Rallis India 217 339.8 57% 280.25 29%
Coromandel International 594 881 48% 744.5 25%
Sumitomo Chemical India 242 338.5 40% 299.05 24%
Insecticides (India) 413 558 35% 484.45 17%
Average         55%
Sensex 33717     48782 45%

The given table speaks for itself. The average gain generated by our recommendation is 55 percent in the last year compared to Sensex generating 45 percent in the same period.

Out of 11 recommendations, seven recommendations were able to beat the performance of Sensex, which means 65 percent of the hit ratio. The above table also highlights that most of our recommendations have cooled off from their peak.

For example, Dhanuka Agritech touched a high of Rs 853 after the recommendation is now available at Rs 672, which is a little more than 20 percent down from the high it reached. Similar is the case with all other companies.

This fall and stagnation in the price once again have convinced us that the same sort of opportunity is available in this sector. We feel there are strong reasons for such optimism.

This time we have selected only the best FIVE COMPANIES that will help you to ride this agri boom. The IE&M Research Team strongly feels that a patient investor is bound to generate handsome returns by investing in these stocks and also in these times of uncertainty and fear.

To read the full story and the list of newly suggested stocks

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About the author: IE&M Team
IE&M Team
Indian Economy & Market is an Indian media and information platform producing data-backed news and analysis on all the vital elements at the intersection of the economy, stock markets, mutual fund, insurance, commodities, currency, technology, startups and business.

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