19 Dividend, 1:10 Split: Smallcap Chemical Stock Below Rs 350 Potential For 14% Upside Ahead; WHY BUY?

Himadri Speciality Chemical stock witnessed a massive rally on April 3rd, so much so that it ended at Rs 337.35 up by 4.52% on BSE with a market cap of Rs 16,617.68 crore. This multi-bagger smallcap stock is attractive to buy further as Prabhudas Lilladher predicts a 14% potential upside to the target price of Rs 385.

Currently, the stock's 52-week high and low is at Rs 399 and Rs 87.16 apiece respectively.

Among corporate affairs, Himadri has a strong track record of dividend payout, and it split only one time.

Dividend: As per Trendlyne data, Himadri has delivered up to 19 dividends since September 2002. In the last 12 months, the company paid dividends up to Rs 0.25% per share. On the current market price, it has a yield of 0.07%.

Stock Split: As of now, Himadri has carried only one stock split. With effect from November 8, 2010, Himadri shares have split into a ratio of 1:10. The face of Rs 10 of 1 equity share was split to a face value of Rs 1 with ten equity shares. The number of shares rose, while its price level got cheaper. However, the share capital reserves remain the same.

Prabhuas Lilladher On Himadri Specialty Chemicals:

Vaishali Parekh, Vice President - Technical Research, at Prabhudas Lilladher said, "The stock has witnessed a strong uptrend with recently finding some correction and bottoming out near the 270 zone, has once again improved the bias with a higher low formation established on the daily chart."

Further, Prakesh said, "It has moved past the important 100 period MA of 326 to improve the bias and further rise is anticipated."

Moreover, as per the analyst, the RSI is well-placed and on the rise indicating much upside potential to propel the stock for higher targets of 355 and 385 levels in the coming days."

Parekh suggests buying the stock for an upside target of Rs 385, keeping the stop loss at Rs 311.

Credit Rating: Last week, e India Ratings and Research Private Limited (Ind-Ra) assigned IND A1+ on Himadri's commercial paper programme worth Rs 100 crore.

Warrants: Also, last month, Himadri approved the allotment of 1,08,47,000 warrants of the Company, on a preferential basis by way of a private placement to Promoters and other nonpromoter investors. The warrants will have an issue price of Rs 316 per warrant in cash for a consideration of Rs 342.77 crore. Upon conversion and exercise of the warrants into equity shares of the Company, the Promoter group's equity in the company will increase by 0.82%, on a fully diluted basis.

Notably, the issue proceeds will be majorly utilised as a growth capital in all the new green field projects
that Himadri have announced and are in pipeline like Cathode Active material manufacturing capex, turnaround of Birla Tyres along with the others including capital expenditure in its existing units and projects i.e. brown field expansion.

About Himadri Specialty Chemical:

Himadri Speciality Chemical Ltd is a global speciality chemical conglomerate with a strong focus on research and development (R&D), innovation and sustainability.

As a pioneer in the production of lithium-ion battery anode and cathode materials in India, it continuously develops and innovates raw materials of the lithium-ion battery value chain. Its diverse product portfolio includes speciality carbon black, coal tar pitch, refined naphthalene, advance materials, SNF, speciality oils, power, etc. catering to various industries such as lithium-ion batteries, paints, plastics, tires, aluminium, graphite electrodes, agrochemicals, defence and construction chemicals. Himadri operates in both domestic and international markets, exporting to 49 countries across the globe.

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