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Anand Rathi Projects Jubilant Ingrevias FY27 Earnings Upswing as CDMO and Specialty Segments Strengthen
Anand Rathi Research has returned to Jubilant Ingrevia with a firm “Buy” recommendation, raising its target price to ₹975 and signaling a clear earnings turnaround that is expected to begin in FY27.
The brokerage’s assessment follows an on‑site visit to the company’s Bharuch manufacturing plant and a detailed review of recent operational developments. Rathi’s team noted improvements across the board, from tighter cost controls to the launch of new product lines.
FY27 is projected to be a watershed year for the specialty‑chemicals maker. Rathi estimates the company’s EBITDA will reach the upper end of its ₹750‑₹800 crore target range, roughly ₹760 crore. That figure surpasses the brokerage’s earlier estimate of ₹730 crore and is a significant jump from the nearly ₹600 crore EBITDA reported for FY26. The upside is driven by stronger contributions from the Specialty Chemicals and Nutrition & Health Solutions businesses, as well as better operating leverage.
A lingering concern had been the financial health of a major customer involved in the Agro CDMO project. Rathi points out that the customer’s cash actions of nearly US$966 million—part of a US$1 billion deleveraging target for 2026—have largely allayed bankruptcy fears. The Agro CDMO plant is now commissioned and commercial production has begun. Although demand visibility remains muted due to weak global agricultural markets and pricing pressure on crop‑protection inputs, a five‑year take‑or‑pay agreement guarantees a minimum revenue stream, protecting the company’s earnings.
Beyond that anchor contract, Jubilant Ingrevia is building a sizable CDMO pipeline. The brokerage reports the company is evaluating more than 100 molecules, with about 20 confirmed opportunities that could generate up to ₹1,500 crore in potential revenue. Rathi expects CDMO revenues to reach approximately ₹1,200 crore by FY28, positioning the segment as a key long‑term growth engine.
Other tailwinds are emerging as well. The Nutrition business is expected to deliver a richer product mix, and the recovery in global acetic acid prices—from roughly US$300 per tonne to about US$450 per tonne—could support margins in the coming quarters.
Specialty Chemicals is projected to drive the majority of earnings growth. Rathi forecasts a compound annual growth rate of 32% for earnings between FY26 and FY28. More than 85% of the incremental EBITDA during this period is expected to come from the Specialty Chemicals and NHS businesses, underscoring the company’s shift toward higher‑margin, value‑added products.
With operational risks moderating, new capacity becoming operational, a protected earnings profile for its Agro CDMO business, and a healthy pipeline of future opportunities, Rathi believes Jubilant Ingrevia is entering a stronger growth cycle. The brokerage maintains its “Buy” recommendation and a target price of ₹975, citing improving earnings visibility, expanding specialty businesses, and multiple margin catalysts.
At present, FY27 is poised to be an inflection year, with EBITDA likely to rise to the upper end of its target range. Investors will be watching the FY27 earnings report for confirmation of the projected upside. The company has not announced any immediate capital‑expenditure plans beyond the existing CDMO ramp‑up, and no regulatory actions or shareholder votes are pending. The next earnings release will provide the first opportunity to assess whether the projected growth drivers materialise.
In summary, Jubilant Ingrevia’s FY27 outlook is underpinned by the commissioning of its Agro CDMO plant, a robust CDMO pipeline, improving specialty‑chemicals margins, and a recovering acetic acid market. The brokerage’s “Buy” rating and ₹975 target price reflect confidence that the company’s earnings trajectory will accelerate in the coming fiscal year.
The brokerage’s assessment follows an on‑site visit to the company’s Bharuch manufacturing plant and a detailed review of recent operational developments. Rathi’s team noted improvements across the board, from tighter cost controls to the launch of new product lines.
FY27 is projected to be a watershed year for the specialty‑chemicals maker. Rathi estimates the company’s EBITDA will reach the upper end of its ₹750‑₹800 crore target range, roughly ₹760 crore. That figure surpasses the brokerage’s earlier estimate of ₹730 crore and is a significant jump from the nearly ₹600 crore EBITDA reported for FY26. The upside is driven by stronger contributions from the Specialty Chemicals and Nutrition & Health Solutions businesses, as well as better operating leverage.
A lingering concern had been the financial health of a major customer involved in the Agro CDMO project. Rathi points out that the customer’s cash actions of nearly US$966 million—part of a US$1 billion deleveraging target for 2026—have largely allayed bankruptcy fears. The Agro CDMO plant is now commissioned and commercial production has begun. Although demand visibility remains muted due to weak global agricultural markets and pricing pressure on crop‑protection inputs, a five‑year take‑or‑pay agreement guarantees a minimum revenue stream, protecting the company’s earnings.
Beyond that anchor contract, Jubilant Ingrevia is building a sizable CDMO pipeline. The brokerage reports the company is evaluating more than 100 molecules, with about 20 confirmed opportunities that could generate up to ₹1,500 crore in potential revenue. Rathi expects CDMO revenues to reach approximately ₹1,200 crore by FY28, positioning the segment as a key long‑term growth engine.
Other tailwinds are emerging as well. The Nutrition business is expected to deliver a richer product mix, and the recovery in global acetic acid prices—from roughly US$300 per tonne to about US$450 per tonne—could support margins in the coming quarters.
Specialty Chemicals is projected to drive the majority of earnings growth. Rathi forecasts a compound annual growth rate of 32% for earnings between FY26 and FY28. More than 85% of the incremental EBITDA during this period is expected to come from the Specialty Chemicals and NHS businesses, underscoring the company’s shift toward higher‑margin, value‑added products.
With operational risks moderating, new capacity becoming operational, a protected earnings profile for its Agro CDMO business, and a healthy pipeline of future opportunities, Rathi believes Jubilant Ingrevia is entering a stronger growth cycle. The brokerage maintains its “Buy” recommendation and a target price of ₹975, citing improving earnings visibility, expanding specialty businesses, and multiple margin catalysts.
At present, FY27 is poised to be an inflection year, with EBITDA likely to rise to the upper end of its target range. Investors will be watching the FY27 earnings report for confirmation of the projected upside. The company has not announced any immediate capital‑expenditure plans beyond the existing CDMO ramp‑up, and no regulatory actions or shareholder votes are pending. The next earnings release will provide the first opportunity to assess whether the projected growth drivers materialise.
In summary, Jubilant Ingrevia’s FY27 outlook is underpinned by the commissioning of its Agro CDMO plant, a robust CDMO pipeline, improving specialty‑chemicals margins, and a recovering acetic acid market. The brokerage’s “Buy” rating and ₹975 target price reflect confidence that the company’s earnings trajectory will accelerate in the coming fiscal year.
