Paradeep Phosphates (PARADEEP IN) – Q1FY27 Result Update – Full backward integration by FY29 – ACCUMULATE
Published on 31 Jul 2026
Paradeep Phosphates (PPL) reported consolidated revenue of INR61bn in Q1FY27, up 36% YoY, driven by 4% volume growth and price hikes across its NPK portfolio. EBITDA/tn improved to INR7,311 from INR6,171 in Q1FY26, supported by strategic raw material sourcing and efficient inventory management. Management highlighted that geopolitical tensions in West Asia are disrupting key shipping routes, resulting in higher freight costs and supply chain uncertainties. Consequently, raw material costs are expected to remain elevated in Q2FY27, which may weigh on margins if addition subsidy support from government is not received. While elevated raw material costs may exert near-term pressure on margins, we believe PPL's increasing backward integration, ongoing capacity expansion, and scale benefits will support sustained earnings growth over the medium term. At the current market price, the stock trades at ~12x FY28E EPS. We value the company at 13x FY28E EPS, implying a target price of INR158, and maintain our 'Accumulate' rating.
