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Mint
4 days ago
- Business
- Mint
Indian chemical stocks are still the FPI darlings. Will they withstand the US tariff heat?
The chemicals and petrochemicals sector has been the biggest draw for foreign money in Indian equities in the last 11 months. It is the only industry to clock uninterrupted foreign portfolio investment (FPI) inflows, even as other sectors saw choppy trends during this period. In July 2025, overseas investors pumped in $130 million into Indian chemical and petrochemical stocks, following a hefty $278 million in June, showed data from NSDL. A year ago, FPIs had pulled out net equity investment worth $61 million from the sector. The telecom equipment space topped the charts for FPI inflows in July, attracting $570 million in net equity investment, followed by metals and mining with $388 million, and food, beverages and tobacco at $175 million. While the chemicals and petrochemicals sector saw 11 consecutive months of FPI buying, the telecom sector witnessed a steady inflow of foreign money since December. Metals and mining, along with food, beverages, and tobacco, attracted foreign inflows only in July. According to NSDL, FPIs were net sellers in the Indian equity markets in July, with a total outflow of ₹17,741 crore. Investors in chemical companies have been rewarded handsomely. In the year to 12 August, dye maker Indochem topped the list, delivering 308% gains, while specialty chemicals producer Camlin Fine Sciences gave 115%. Pigment manufacturer Kesar Petroproducts (63%), aroma and fragrance maker Privi Specialty Chemicals (59%), and life sciences-focused Anupam Rasayan (52%) also posted stellar returns. However, in the last one month, most chemical stocks have come under pressure because of US President Donald Trump's tariffs. Hikal slipped 20%, while Castrol India and Laxmi Organic eased 4%, Fine Organic and Gujarat Alkalies fell 5%, and Alkyl Amines, Archean Chemical, and Deepak Nitrite were down 7% each. Linde India dropped 8.5%, Atul 10.5%, and Fairchem Organic 12.5%. Losses were steeper for Aarti Surfactants, Aarti Industries, and Vinati Organics at 15% each, Clean Science at 17%, and Camlin Fine Sciences, plunged 24%. A few names, however, swam against the tide: Bliss GVS Pharma gained 13%, Tatva Chintan rose 9%, Tata Chemicals added 5%, Sudarshan Chemical climbed 19%, and TGV Sraac surged an impressive 32%. Now the key question facing investors is whether the momentum in chemical and petrochemical stocks can hold up after US President Donald Trump announced an additional 25% tariff on India, taking the total hit to a hefty 50%. According to the Indian Trade Portal, India is the sixth-largest chemical producer in the world and the third-largest in Asia. It ranks 14th in global chemical exports (excluding pharmaceuticals), contributing 2.5% to global chemical sales. Ratings firm Icra, in its August report, said 60% of India's agrochemicals output is exported, with the US accounting for 18% in FY2025. The US also sources agrochemicals heavily from the EU, Mexico, and China; while the EU now faces a 15% tariff, Mexico's rates match India's, and China continues to face 30%. India is a key US supplier of dyes, pigments, and other chemicals alongside China, the EU, and Mexico. However, tariff advantages for the EU and narrowing gaps with China could increase pricing pressure on Indian exports. The hope that pharma and healthcare might escape US tariffs had sparked some cheer, spilling over into a rally for chemicals and petrochemicals earlier this year, said Nilesh Ghuge, research analyst at HDFC Securities. But that optimism may be short-lived if Trump goes ahead with extra tariffs, he warned. 'Until there's clarity, investors might be better off sitting on the sidelines rather than jumping in head-first." Ghuge sees volumes inching up but says prices may take another couple of quarters to recover. Research co-head at PL Capital, Swarnendu Bhushan, also remains cautious on the sector and does not see a rebound anytime soon. 'Margins are shrinking, volumes are inching up, but prices aren't recovering, with Chinese overcapacity dumping extra supply into the market," he said. Also Read: China has now disrupted specialty chemical market. Startups step up Tariffs could shave off some exports, especially of more commoditised products, said Prashant Vasisht, senior vice president and co-group head, corporate ratings, Icra. Commodity chemicals are high-volume, standardized products—like sulfuric acid or ethylene—made for global and domestic markets. They serve as basic raw materials for other industries and show little difference from one producer to another. "However, certain speciality chemicals could bear the brunt of tariffs and still maintain volumes," he added. Pricey or fair deal? 'Valuations remain lofty for most chemical and petrochemical names, especially with Chinese dumping squeezing margins, but there are still a few decently priced pockets that could quietly deliver alpha," said Ghuge of HDFC Securities. Valuations are well above their five-year averages. Tatva Chintan, for instance, is trading at a sky-high price-to-earnings (P/E) of 615.67 versus its five-year average of 477.37. Tata Chemicals (42.6 from 31.48), Gujarat Fluorochemicals (58.02 vs 44.16), Deepak Fertilisers and Petrochemicals (43.52 vs 30.72), Archean Chemical (34.98 vs 25.67), SRF (60.30 vs 47.88), and Aarti Industries (55.50 vs 41.61) are also sporting richer-than-usual multiples. Market participants point to massive capacity additions in China and a weak global economic outlook as key headwinds, while the positives lie in a healthy domestic demand outlook and a gradual shift in global supply chains towards India. Also Read: Why Coromandel International has thrived while many fertilizer companies have struggled Scope for upgrades Ambit Asset Management's July newsletter noted that after the boom years of FY20–22, the market expected strong growth for FY22–25, projecting a 23% earnings CAGR and 25% median Ebitda margin. Instead, revenue fell at a -3% CAGR and margins dropped to 13% in FY24, before recovering to 18% in the second half of FY25 as businesses stabilised. Looking ahead, after the weak FY22-25 period, the market now expects only a modest recovery—18% revenue CAGR over FY25–27, with average Ebitda margins improving slightly to 18% in FY27 from 16% in FY25. 'We believe there is significant scope of upgrades to these assumptions given global channel inventory is at a 5-year low, which suggests restocking led demand; recent pricing up-move indicates strong improvement in margins as well, and resultantly, we believe there is scope for upgrades," said Ambit Asset. Also Read: India eases quality control norms on key chemicals imported from the US, China
Business Standard
08-08-2025
- Business
- Business Standard
Camlin Fine Sciences reports consolidated net loss of Rs 9.96 crore in the June 2025 quarter
Sales rise 11.21% to Rs 423.55 crore Net Loss of Camlin Fine Sciences reported to Rs 9.96 crore in the quarter ended June 2025 as against net loss of Rs 33.95 crore during the previous quarter ended June 2024. Sales rose 11.21% to Rs 423.55 crore in the quarter ended June 2025 as against Rs 380.85 crore during the previous quarter ended June 2024. Particulars Quarter Ended Jun. 2025 Jun. 2024 % Var. Sales 423.55380.85 11 OPM % 4.507.59 - PBDT 12.667.50 69 PBT -4.26-7.05 40 NP -9.96-33.95 71
Time of India
09-07-2025
- Business
- Time of India
Is the chemical sector entering a new supercycle? Top stocks already up 35–135% in 2025
The chemical sector is quietly regaining momentum in 2025, with several stocks delivering stellar returns year-to-date as investors begin to price in an early recovery. Companies like Camlin Fine Sciences , Deepak Fertilisers , India Glycols , and Tanfac Industries have rallied between 35% and 135% so far this year, driven by rising volumes, capacity ramp-ups, and improving global demand. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like פרפור פרוזדורים אחרי גיל 70? גלו את הפתרון שיחסוך לכם המיון טרומיון קראו עכשיו Undo According to Axis Securities, most specialty chemical companies under its coverage are expected to report steady year-on-year growth in Q1FY26, primarily led by volume expansion on a low base. However, quarter-on-quarter performance may remain uneven due to pricing pressures, tariff-related uncertainties, and ongoing geopolitical risks. 'Global destocking has largely been completed, and fresh demand is now contributing to growth in international markets,' Axis Securities said in its latest sector preview. Live Events Momentum in high-value segments Within the sector, refrigerant gas players are expected to post strong quarterly results, supported by favourable global pricing and solid export demand. On the other hand, commodity chemical companies may continue to face pressure from weak pricing, although operational efficiency initiatives are expected to provide some support. Domestic demand remains relatively resilient. Axis expects agrochemical players with a domestic focus to do well, supported by new product launches, volume growth ahead of the kharif season, and a normal monsoon forecast. Generic agrochemical players are also likely to benefit from volume-led growth as inventory correction in global markets nears completion. Stock-specific expectations in Q1FY26 Axis remains constructive on select names that are showing visibility in earnings growth and margin resilience. Among its top picks: - Camlin Fine Sciences is expected to see top line growth led by continued momentum in the blends and aroma business, ramp-up of the vanillin plant, and improved margins due to a better product mix and closure of loss-making overseas operations. - Navin Fluorine is projected to benefit from capacity expansion, strong export momentum, and the stabilisation of its HFO plant. EBITDA margins are expected to improve, supported by a healthy order book in specialty chemicals. - PI Industries is likely to post revenue growth, driven by the performance of new products in the non-agrochemical segment. Though the pyroxasulfone portfolio remains under pressure, the overall margin profile is expected to remain stable. - Dhanuka Agritech is expected to deliver robust top-line and margin expansion, driven by strong monsoon trends, demand momentum, and the rollout of new molecules. Tariff risk lingers in the background Axis cautions that tariff-related uncertainties could impact near-term performance, particularly for companies with high exposure to the US and EU markets. 'Over the long term, the tariff environment could favour Indian players by reducing competition from countries facing higher tariff rates than India. Nevertheless, we advise maintaining a cautious outlook on companies with substantial US export exposure, as their near-term performance may be adversely affected,' the brokerage noted. Midcap plays and what to watch Midcap chemical companies with an export tilt, operational efficiency, and product innovation are seen as better positioned to benefit from the ongoing recovery. Axis's top stock picks include Camlin Fine Sciences, Navin Fluorine, PI Industries, Dhanuka Agritech, and Mold-Tek Packaging . These companies are expected to deliver a mix of earnings growth, margin expansion, and cost control in the quarters ahead. (Data Inputs - Ritesh Presswala) ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Economic Times
19-06-2025
- Business
- Economic Times
Camlin Fine Sciences sees 51% surge in shares amid anti-dumping duties on Chinese Vanillin
ET Intelligence Group: Shares of Camlin Fine Sciences, a manufacturer and exporter of specialty chemicals, have surged nearly 51% over the past month amid anti-dumping duties imposed by the US and the European Union (EU) on Chinese manufacturers. ADVERTISEMENT The move is expected to benefit the company's aroma exports business over the next three-four quarters. However, investors should remain cautious, as sustaining such returns will depend on the company's ability to deliver strong financial performance in the medium term. The EU imposed anti-dumping duties of 131.1% on imports of vanillin, an organic compound, originating in China following a similar move by the US last year. These actions have driven up vanillin prices in both regions, which are significant export markets for Camlin. Camlin's business involves manufacturing, marketing, and supply of specialty chemicals used across various industries-including food, animal feed, pet nutrition, fragrance, pharmaceuticals, and industrial products. Its blends and aroma businesses, which include vanillin, were the primary drivers of growth in the previous financial year. The blends segment generated ₹878 crore in revenue in FY25 up from ₹747 crore in the previous financial year while revenue from the aroma ingredients segment surged to ₹176 crore from ₹35 crore in FY24. Total revenue improved by 15% to ₹1,666.5 crore for by the increase in the prices, the company plans to increase its vanillin capacity utilisation from the current 45-50% to 100% over the next two years that would lead to lower cost per unit. ADVERTISEMENT "We should grow blends business by about 20% in the next two to three years and the Ebitda margins will improve in some of the geographies. So it will be in the high teens," Nirmal Momaya, managing director, Camlin Fine Sciences told analysts during an earnings call. The company's Ebitda margin was 12.5% in FY25 compared with 12.6% in the previous company's net debt declined to ₹492 crore as of March 2025 from ₹564 crore a year ago, improving the net debt-to-equity ratio to 0.5 from 0.7. ADVERTISEMENT Higher growth potential and improved debt position has prompted brokerages to raise the company's valuations. "We raise the valuation multiple to 15 times FY27 expected earnings (previously 12 times) to reflect the anticipated improvement in performance due to increasing share of high margin blends, rising vanillin prices, and improving profitability," said Axis Securities in a stock was ended at ₹300 on Wednesday on the BSE, reflecting 182% jump from the year-ago level. (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
19-06-2025
- Business
- Time of India
Camlin Fine Sciences sees 51% surge in shares amid anti-dumping duties on Chinese Vanillin
ET Intelligence Group: Shares of Camlin Fine Sciences , a manufacturer and exporter of specialty chemicals , have surged nearly 51% over the past month amid anti-dumping duties imposed by the US and the European Union (EU) on Chinese manufacturers. The move is expected to benefit the company's aroma exports business over the next three-four quarters. However, investors should remain cautious, as sustaining such returns will depend on the company's ability to deliver strong financial performance in the medium term. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 혈압 안정화를 돕는 블러디션 배합 성분 메디셜 더 읽기 Undo The EU imposed anti-dumping duties of 131.1% on imports of vanillin, an organic compound, originating in China following a similar move by the US last year. These actions have driven up vanillin prices in both regions, which are significant export markets for Camlin. Camlin's business involves manufacturing, marketing, and supply of specialty chemicals used across various industries-including food, animal feed, pet nutrition, fragrance, pharmaceuticals, and industrial products. Its blends and aroma businesses, which include vanillin, were the primary drivers of growth in the previous financial year. Agencies The blends segment generated ₹878 crore in revenue in FY25 up from ₹747 crore in the previous financial year while revenue from the aroma ingredients segment surged to ₹176 crore from ₹35 crore in FY24. Total revenue improved by 15% to ₹1,666.5 crore for FY25. Live Events Buoyed by the increase in the prices, the company plans to increase its vanillin capacity utilisation from the current 45-50% to 100% over the next two years that would lead to lower cost per unit. "We should grow blends business by about 20% in the next two to three years and the Ebitda margins will improve in some of the geographies. So it will be in the high teens," Nirmal Momaya, managing director, Camlin Fine Sciences told analysts during an earnings call. The company's Ebitda margin was 12.5% in FY25 compared with 12.6% in the previous year. The company's net debt declined to ₹492 crore as of March 2025 from ₹564 crore a year ago, improving the net debt-to-equity ratio to 0.5 from 0.7. Higher growth potential and improved debt position has prompted brokerages to raise the company's valuations. "We raise the valuation multiple to 15 times FY27 expected earnings (previously 12 times) to reflect the anticipated improvement in performance due to increasing share of high margin blends, rising vanillin prices, and improving profitability," said Axis Securities in a report. The stock was ended at ₹300 on Wednesday on the BSE, reflecting 182% jump from the year-ago level.
