Deepak Nitrite (DN IN) – Q1FY27 Result Update – Improved spreads drive margin expansion – REDUCE
Published on 06 Aug 2026
DN continues to pursue multiple growth initiatives, primarily focused on expanding its Phenolics portfolio. However, our analysis indicates that global phenol overcapacity remains a structural concern, while the elevated phenol-acetone spreads have already begun moderating on a week-on-week basis. As supply conditions normalize, we expect spreads and margins to gradually revert. The stock is currently trading at ~32x FY28E EPS. We value the company at 29x FY28E EPS and maintain our 'REDUCE' rating with a target price of INR1,586.
