Nuvama Institutional Equities has reiterated its 'Buy' rating on Atul Ltd, a prominent chemical sector stock, following the company's recent quarterly performance. The brokerage firm has also revised its target price for Atul Ltd upwards, from Rs 7,857 to Rs 8,451.
Atul Ltd's Quarterly Performance and Nuvama's Outlook
Atul Ltd reported a robust quarter, with sales growing 15.0 percent year-on-year to Rs 1,670 crore. While the gross margin saw a decline of 320 basis points year-on-year, settling at 46.5 percent, Nuvama noted that this was primarily due to compressed spreads within the Aromatics and Polymers segments. Despite slightly missing Nuvama's initial estimates, the results aligned with consensus expectations after adjustments for employee provision reversals.
Management at Atul Ltd has indicated a strategic focus on optimizing existing assets and exploring inorganic growth opportunities. The company is also evaluating significant investment prospects, though near-term geopolitical tensions could impact margins. Nuvama has increased its earnings estimates for Atul Ltd for FY27 and FY28 by 8 percent each. The brokerage continues to value the stock at 30x FY28E EPS.
Rs 30 Dividend Announced: Key Dates
In a separate development, Atul Ltd's Board of Directors has proposed a dividend of Rs 30 per equity share for the financial year concluded on March 31, 2026. This dividend payout is contingent upon shareholder approval at the Annual General Meeting (AGM), which is scheduled for July 31, 2026.
The company has officially set July 17, 2026, as the record date to determine the eligibility of shareholders for this dividend. Consequently, the Register of Members and Share Transfer Books will remain closed from July 18, 2026, to July 24, 2026 (inclusive of both days). If approved by shareholders at the AGM, the dividend is slated for payment on or after August 5, 2026.