Navin Fluorine shares hit 52-week low after weak Q3 results; is this an opportunity for investors?

Navin Fluorine International (NAVINFLUOR) shares suffered deep losses on Wednesday after the chemical manufacturer reported quarterly results that fell short of analysts' expectations. The stock of Navin Fluorine weakened by as much as Rs 186.8, or 5.7 per cent, to a 52-week low of Rs 3,074.7 apiece on BSE. 

After market hours on Tuesday, Navin Fluorine reported a 27 per cent year-on-year fall in net profit to Rs 78 crore for the October-December period, including an exceptional gain of Rs 52 crore, with 11 per cent de-growth in revenue to Rs 502 crore. 

The company registered Rs 76 crore in earnings before interest, taxes, depreciation and amortisation (EBITDA) for the quarter ended December 31, 2023, as against Rs 156 crore for the corresponding period a year ago.

Its margin, a key measure of profitability, contracted to 15.1 per cent for the fiscal third quarter from 27.7 per cent a year ago, according to a regulatory filing. 

According to Zee Business research, Navin Fluorine's quarterly net profit was estimated at Rs 60 crore, revenue at Rs 500 crore, EBITDA at Rs 112 crore, and margin at 22.4 per cent. 

The company's management said it expects a strong recovery in the second half of the next financial year. 

What analysts make of Navin Fluorine Q3 results

Equity Rush CEO Kunal Saraogi suggests market participants take a "wait and watch" approach on Navin Fluorine shares and avoid buying till they cross major resistance at Rs 3,400. 

The stock appears poised to slide below significant support placed at Rs 2,900, Saraogi told Zee Business. 

Earlier on Wednesday, Zee Business analyst Varun Dubey recommended selling the chemical stock for a target of Rs 3,160 with a stop loss at Rs 3,290.

Foreign brokerage Jefferies maintained a 'hold' rating on Navin Fluorine International and reduced its target price for the stock to Rs 2,950 from Rs 3,425 after the earnings announcement. Its target implies a 9.5 per cent downside in Navin Fluorine shares from the previous close.  

Another foreign brokerage, Citi kept its 'buy' call on Navin Fluorine with a target of Rs 3,750, suggesting an upside of 15 per cent. 

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