Angel Broking has maintained 'Accumulate' on UPL with target price of Rs 353 in its report.
The company has announced complete 50% stake sale in the Brazillian agrochemical company Sipcam UPL Basil S.A. In April this year, the company's overseas subsidiary entered into an agreement with Sipcam to divest its entire stake in Sipcam S.P.A. for a gross consideration of USD 58.5 million (around Rs 3.51 billion). Sipcam is the current 50% joint venture partner with UPL in Sipcam UPL Brasil S.A.
Commenting on the investment rationale, Angel Broking said, ''UPL has its major presence in Brazil through two companies, namely, UPL do Brasil Industria eComerciode Insumos Agropecuarios S.A., wherein UPL has recently raised its stake to 73% and Sipcam UPL Brasil S.A., wherein UPL has 50% stake, and this has been fully divested now. The funds realized from the stake sale will be utilized for new opportunities and meet growing business requirements.
It will also help UPL to have more focused approach for Brazilian agrochemical market which is one of the largest agrochemicals market in the world. We maintain accumulate rating on the stock with a price target of Rs 353.''
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