HSBC has retained a mixed stance on the Indian agri-inputs sector, flagging that pesticide prices are beginning to reverse upwards while product inventories in key herbicides are moderating. It said policy measures in China to address outdated capacities and reduce disorderly competition are a positive for the industry, but concrete steps will be needed before the benefits fully materialise.
The brokerage retained buy ratings on UPL with a target price of ₹775 and Dhanuka Agritech (DAGRI) with a target of ₹1,850, citing favourable positioning and strong growth prospects. It maintained hold ratings on PI Industries with a target of ₹3,500 and Bayer CropScience with a target of ₹5,500, reflecting steady fundamentals but limited near-term upside. HSBC downgraded Rallis India to reduce with a target price of ₹250 and Tata Chemicals to reduce with a target of ₹780, citing weaker outlooks relative to peers.
HSBC said the sector is at an inflection point, with pricing trends stabilising and demand likely to improve, but selectivity is key given divergent performance across companies.
Disclaimer: The views and recommendations made in this article are those of HSBC. This article does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.
