Top picks: HDFC Securities recommends these speciality chemical stocks to buy

The research analysts of the broking firm HDFC Securities said in a note that “The Indian chemical industry continues to be an attractive hub of opportunities, even in an environment of global uncertainty. The uniqueness of the chemical industry is that it requires both the creation of tangible assets and technical manpower. We believe domestic chemical companies have abundant opportunities to partner in technology. Chemical companies may be able to take advantage of a variety of opportunities by strategically investing in research & development (R&D). New opportunities in the form of collaboration with technically advanced global companies could emerge in the industry.”

“Instead of being sold based on their chemical identity, specialty chemicals are frequently sold based on how well they perform in the intended application. Therefore, the business requires significant application development and R&D investments to stay relevant,” they further added.

They further claimed that “The chemical industry’s growth is not hostage to any one economic parameter or any one end-user industry. Rising domestic demand and the need to evolve have forced domestic chemical companies to expand their capacities to remain competitive. Our positive stance on the sector is backed by its strong growth, aided by diversity in terms of chemistries and/or technologies. We maintain BUY on Aether Industries, Neogen Chemicals, Navin Fluorine, Galaxy Surfactants, NOCIL, Aarti Industries, ADD on SRF, Fine Organics, Sudarshan Chemical, while maintain SELL on Deepak Nitrite, Vinati Organics and Alkyl Amines. We are also initiating coverage on Ami Organics Ltd (TP: INR 1,160) with a BUY and Clean Science and Technology Ltd (TP: INR 1,230) with a SELL recommendation.”

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.