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Pidilite, the manufacturer of the popular ‘Fevicol’ brand of adhesives has a stellar track record for wealth creation. Strong brand recall and pricing power are key strengths of the company where prospects are linked to overall domestic consumption for home and office improvement. Long term growth prospects remain bright due to strong position in the adhesives business which has been strengthened by recent acquisition of Araldite a market leader in the epoxy adhesive segment. High valuation and near term challenges on domestic demand due to Covid-19 pandemic lead us to rate this company as neutral instead of overweight rating. Recent spike in key raw material – VAM is a cause for concern – 12-05-2021 Price: 1,700.00 Rating: Neutral Recommendation: Hold

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