Chemicals & Petrochemicals
Sudarshan Chemical Industries Limited, together with its subsidiaries, manufactures and sells organic, inorganic, effect pigments, and dispersions in India, the United States, Europe, China, Mexico, Japan, and internationally. It operates in two segments, Pigments and Others. The company offers its pigment products under the Sudaperm, Sudatex, Sudafine, Sudacolor, Sudafast, Sumica, Sudadur, Sudasol, Sumicos, Sudatherm, Sudajet, Sudanyl, Sudacos, and Prestige brands that are used in coatings, paints, plastics, inks, cosmetics, textiles, printing, and other applications. It also manufactures pollution control equipment, size reduction equipment, pneumatic conveying systems, and grinding equipment for industrial applications; and clean air, grinding, and power handling solutions. The company was incorporated in 1951 and is headquartered in Pune, India.
Valuation | |
---|---|
Market Cap | 8.41 kCr |
Price/Earnings (Trailing) | 71.35 |
Price/Sales (Trailing) | 3.03 |
EV/EBITDA | 24.23 |
Price/Free Cashflow | 55.01 |
MarketCap/EBT | 50.48 |
Fundamentals | |
---|---|
Revenue (TTM) | 2.78 kCr |
Rev. Growth (Yr) | 17.7% |
Rev. Growth (Qtr) | -4.3% |
Earnings (TTM) | 117.89 Cr |
Earnings Growth (Yr) | -96.48% |
Earnings Growth (Qtr) | -98.28% |
Profitability | |
---|---|
Operating Margin | 7.51% |
EBT Margin | 6% |
Return on Equity | 9.73% |
Return on Assets | 4.51% |
Free Cashflow Yield | 1.82% |
Summary of Sudarshan Chemical Indus.'s latest earnings call, featuring management's outlook on business performance, financial results, and analyst Q&A sessions that highlight key strategic initiatives and market challenges.
Last updated: Feb 25
Management Outlook and Key Points:
1. Growth Momentum in Pigments:
2. Heubach Acquisition Progress:
3. Engineering Business (Rieco) Turnaround:
4. Financial Health:
5. Market Confidence:
6. Sustainability & Innovation:
Management remains confident in long-term growth, emphasizing operational efficiency, strategic acquisitions, and market share gains globally.
Last updated: Feb 25
Question 1:
"Could you help us understand why the pigment segment EBIT improved sequentially while consolidated EBITDA and EBIT declined?"
Answer:
The pigment segment's EBIT declined sequentially (Rs.48 crore in Q3 vs. Rs.74 crore in Q2) due to lower revenue (Rs.601 crore vs. higher Q2). The consolidated decline reflects this, offset only partially by Rieco's reduced losses (negative Rs.1 crore vs. negative Rs.11 crore in Q2).
Question 2:
"How has demand been across user segments (coatings, polymers) in domestic and international markets?"
Answer:
Domestic coatings demand was muted due to post-festive destocking, while polymers remained stable. Exports grew 29% YoY, driven by new product traction in international markets.
Question 3:
"Why did gross margins remain flat despite export growth, and what is the outlook?"
Answer:
Margins (~45%) were stable despite export growth due to product mix shifts. Specialty pigments (16% YoY growth) and new molecules will sustain margins, with annual shutdown timing affecting quarterly costs.
Question 4:
"What is the status of the Heubach acquisition, and how will it impact profitability?"
Answer:
All antitrust approvals secured; transaction expected by March 2025. Integration costs (Rs.41.9 crore) are exceptional. Post-acquisition, operational synergies and restructuring aim for breakeven in Year 1.
Question 5:
"How will Rieco's turnaround progress, and what are the FY26 expectations?"
Answer:
Rieco's EBITDA improved to breakeven (vs. negative Rs.7 crore YoY) via cost controls. A 18"“24-month transformation targets sustainable 10%+ EBITDA margins through operational efficiency and growth initiatives.
Question 6:
"What is the post-acquisition capital structure, and how will debt evolve?"
Answer:
Equity raised Rs.1,100 crore (QIP/preferential), with remaining Rs.1,600 crore funded via debt. Net debt post-acquisition may settle at Rs.1,300"“1,400 crore, subject to phased fund utilization.
Question 7:
"How will mono-material packaging regulations impact the business?"
Answer:
Minimal impact expected; Sudarshan is developing compliant solutions. Specialty pigments for plastics remain resilient to regulatory shifts.
Question 8:
"Will Sudarshan avail tax benefits from Heubach's historical losses?"
Answer:
No significant tax benefits, as the deal includes asset purchases (losses not transferable) and share purchases (limited applicability).
Question 9:
"Are there governance changes due to reduced promoter stake?"
Answer:
No immediate changes; the board may evaluate professional management structures later. Promoters remain strategic stakeholders.
Question 10:
"When will Heubach's financials consolidate, and what are open offer details?"
Answer:
Heubach's consolidation begins post-closing (target: March 2025). Open offer post-transaction requires SEBI/stock exchange approvals; details post-closure.
Size: Market Cap wise it is among the top 20% companies of india.
Smart Money: Smart money has been increasing their position in the stock.
Balance Sheet: Strong Balance Sheet.
Dilution: Company has a tendency to dilute it's stock investors.
Comprehensive comparison against sector averages
SUDARSCHEM metrics compared to Chemicals
Category | SUDARSCHEM | Chemicals |
---|---|---|
PE | 70.88 | 26.42 |
PS | 3.01 | 1.84 |
Growth | 11.9 % | 11.6 % |
SUDARSCHEM vs Chemicals (2021 - 2025)
Understand Sudarshan Chemical Indus. ownership landscape with insights into key distribution patterns, offering investors a clear view of stakeholder dynamics.
Shareholder Name | Holding % |
---|---|
Hdfc Small Cap Fund | 7.3% |
Akash Bhanshali | 7.13% |
ANUJ NARAYANDAS RATHI | 6.93% |
Tata Mutual Fund - Tata Small Cap Fund | 6.09% |
RAJESH BALKRISHNA RATHI | 5.15% |
PRADEEP RAMWILAS RATHI | 4.36% |
RAHUL PRADEEP RATHI | 3.85% |
Axis Mutual Fund Trustee Limited A/C Axis Mutual Fund A/C Axis Small Cap Fund | 2.67% |
Vijaykumar Ramchandra Rathi | 2.66% |
Rohit Kishor Rathi | 2.62% |
Franklin India Opportunites Fund | 2.3% |
SOW RACHNA RATHI FAMILY TRUST (TRUSTEES - RAJESH BALKRISHNA RATHI AND AJAY BALKRISHNA RATHI) | 1.54% |
Lata Bhanshali | 1.46% |
Vijay Kishanlal Kedia | 1.27% |
Vanguard Total International Stock Index Fund | 1.03% |
MANAN AJAY RATHI | 0.67% |
BALKRISHNA RATHI FINANCE PRIVATE LIMITED | 0.59% |
NARAYANDAS JAGANNATH RATHI | 0.56% |
RAJESH BALKRISHNA RATHI (HUF) (KARTA - RAJESH BALKRISHNA RATHI) | 0.23% |
RACHNA RAJESH RATHI | 0.02% |
Distribution across major stakeholders
Distribution across major institutional holders
Investor Care | |
---|---|
Dividend Yield | 0.61% |
Dividend/Share (TTM) | 6.1 |
Shares Dilution (1Y) | 13.5% |
Diluted EPS (TTM) | 17 |
Financial Health | |
---|---|
Current Ratio | 1.21 |
Debt/Equity | 0.44 |
Debt/Cashflow | 0.36 |
Analysis of Sudarshan Chemical Indus.'s financial performance, highlighting revenue trends, growth patterns, and key metrics through quarterly analysis.
Last Updated: Dec 31, 2024
Description | Share | Value |
---|---|---|
Pigments | 90.2% | 601.2 Cr |
Others | 9.8% | 65.4 Cr |
Total | 666.6 Cr |
Detailed comparison of Sudarshan Chemical Indus. against industry peers, highlighting key financial metrics, valuation ratios, and performance indicators to provide competitive context within the sector.
Ticker | Name | Mkt Cap | Revenue | Price %, 1M | Returns, 1Y | P/E | P/S | Rev 1-Yr | Inc 1-Yr |
---|---|---|---|---|---|---|---|---|---|
ATUL | AtulSpecialty Chemicals | 19.14 kCr | 5.42 kCr | +5.92% | +9.62% | 44.77 | 3.53 | +13.37% | +19.56% |
VINATIORGA | Vinati OrganicsSpecialty Chemicals | 17.42 kCr | 2.2 kCr | +6.29% | +2.40% | 45.09 | 7.93 | +16.41% | +7.41% |
BALAMINES | Balaji AminesSpecialty Chemicals | 4.17 kCr | 1.49 kCr | +6.57% | -42.09% | 21.86 | 2.79 | -13.51% | -11.35% |