Latest news with #GreenPortfolioPMS
Time of India
3 days ago
- Business
- Time of India
Investing in these 3 chemical sector stocks can give good returns now as sector is reviving
After a lull of about three years, India's chemicals sector now appears poised for an upgrade. If you are looking for a contrarian investment strategy , then you might want to take a small exposure to this sector. Here's why. On a rebound The sector saw a marginal but noticeable improvement in performance during the January–March 2025 quarter. While much of the gain can be attributed to the low base effect, analysts remain optimistic. Of the 32 companies tracked by Reuters-Refinitiv (with estimates from at least two analysts), 19—or 59.3%—beat net profit expectations for the quarter. Anuj Jain, Co-founder of Green Portfolio PMS, says the March quarter results signal the beginning of an upcycle in the chemicals industry after a pause of nearly 2–3 years. Though valuations remain high for several large-cap stocks in the sector, many mid- and small-cap companies are still available at attractive valuations. A bleak past The chemicals sector has faced persistent headwinds over the past few quarters due to muted demand, weak realisations amid pricing pressures, inventory destocking in the agrochemicals segment, and heightened competition from China. Data compiled from the Reuters-Refinitiv database for 139 chemical companies with a market cap of more than Rs.100 crore shows dismal aggregate revenue growth of just 2% and 3.4% in the June and September quarters of 2024-25, on a year-on-year basis. Nearly 54% of these companies underperformed the Nifty 500 index over the last year, while 66% lagged the broader market benchmark in 2025 year-to-date. Live Events Brokers upbeat, but wary A pick-up in domestic demand for RACs (room air conditioners) and the sheer rise in demand for gas used in refrigeration and air conditioning is expected to bode well for the sector. While a B&K Securities report highlights that the weakening of competition from within the European Union will open up export opportunities for Indian companies, it also cautions against the continued threat of strong competition from China. On the other hand, a gradual recovery is expected in the agrochemicals segment, supported by the rising demand for newer, innovative products and biological alternatives. A Motilal Oswal report released in March 2025 notes that prices in the global crop protection industry are likely to bottom out in 2025 across all key regions and product segments, paving the way for a more stable growth trajectory ahead. The B&K Securities report notes that a sustained recovery in demand from the EU27 block is crucial to boosting the export growth potential of the Indian chemicals industry. It adds that with inventory de-stocking now largely complete in European markets, both demand and volumes are expected to drive growth going forward. Challenges The US trade tariffs, low-cost dumping by Chinese manufacturers, and weak demand in Europe remain some of the major concerns for the sector. An April 2025 Kotak Securities report expresses hope for a decent recovery over 2024–25 and 2026–27. However, in the event of a prolonged tariff war, it cautions that there could be more substantial downside risk to these expectations. Here are three companies worth considering for a small exposure. These firms have reported double-digit growth in net earnings for the March 2025 quarter and enjoy the highest level of analyst coverage within the sector. SRF Q4 revenue and net profit beat estimates by 7.4% and 9.3%. Strong performance in specialty chemicals, refrigerant gases, and packaging films. 2025-26 revenue guidance at 20% growth. Elara Capital maintains an 'accumulate' rating, expecting gains from recovering demand. Navin Fluorine Q4 revenue and EBITDA beat estimates by 2.4% and 7.9%. CDMO (Contract Development and Manufacturing Organisation) and high-performance products drove growth. Refrigerant gas demand and better pricing supported performance. Management targets ~25% EBITDA margin in 2025-26. Prabhudas Lilladher sees strong long-term growth potential. UPL Q4 revenue and EBITDA beat estimates by 3.6% and 9.9%. Growth is driven by strong volumes, and inventory normalisation. 2025-26 revenue growth guided at 4-8%, led by volumes. Recovery in key markets and new products to aid growth. Antique sees balance sheet improving and growth momentum continuing.
Economic Times
23-04-2025
- Business
- Economic Times
IT bore brunt of FPI pullout in April amid tariff turmoil
Mumbai: The information technology (IT) sector saw the highest selling from overseas investors between April 1 and 15 as concerns over the impact of an expected US downturn heightened risk-off sentiment. Foreigners sold IT shares worth ₹13,828 crore in this period, after pulling ₹8,451 crore out of sector in March. In 2024, foreign investors pumped over ₹14,000 crore into the sector. ADVERTISEMENT "A significant chunk of orders in the IT sector are driven by the US, and since the outlook on those orders is uncertain given the concerns of a slowdown in the US, the sector has seen highest outflows in the first half of April," said Divam Sharma, fund manager, Green Portfolio PMS. Overseas investors offloaded shares in the financial services and capital goods sectors worth ₹4,501 crore and ₹3,019 crore, respectively. While capital goods had seen outflows last month, financial services had received foreign inflows worth over ₹14,000 crore. "Most sectors are anticipated to be impacted by the confusion on Trump tariffs but sectors with premium valuations are more prone to higher foreign outflows," said UR Bhat, director, Alphaniti. In the first half of April, foreigners sold Indian equities worth ₹37,108 crore across 17 sectors after infusing ₹31,877 crore in the second half of March, according to NSDL. Sharma said foreign sell-off in financial services has tempered after the recent outflows because of comfortable valuations."Bank Nifty has performed well owing to the short squeeze in banking stocks, and since it is a domestic-facing sector, tariffs are not likely to have a major impact on the sector," he said. ADVERTISEMENT Metals and mining, oil and gas, automobiles and construction sectors also saw foreign outflows over ₹2,000 crore each. They bought shares worth ₹3,181 crore across 6 ix sectors in first half of April, with elecommunications receiving the highest inflows of ₹2,137 crore. Foreign investors have pumped over ₹17,600 crore into stocks in previous 5 trading sessions, but they remain net sellers in April of ₹16,670 crore. (You can now subscribe to our ETMarkets WhatsApp channel)
