DSIJ.in JULY 22 - AUG 4, 2019 I DALAL STREET INVESTMENT JOURNAL (^53)
133.9 per cent, respectively. Also, PAT of companies like
Gujarat Fluorochemicals, Dharamsi Morarji, Transpek
Industry, Sadhana Nitrochem and Deepa Nitrite grew by 461.9
per cent, 275.7 per cent, 148.9 per cent, 143.9 per cent and
119.7 per cent, respectively, in FY19.
The top company by market cap, Asian Paints grew moderately
with 12.1 per cent growth in revenue, 10.2 per cent growth in
operating profit and 9.5 per cent growth in PAT in FY19 on yoy
basis. The chemical company Pidilite Industries’ revenue grew
by 13.8 per cent, operating profit grew by 2 per cent while PAT
de-grew by 3.8 per cent in FY19. The leading company in
pesticides and agrochemicals UPL posted 24.7 per cent growth
in revenue, 13.3 per cent growth in operating profit and 29.1
per cent de-growth in PAT in FY19.
Some of the companies witnessed turnaround where they
earned net profit in FY19 as against net loss in FY18. Camlin
Fine Sciences’ net profit in FY19 was 3.06 crore as against net loss of24.15 crore in FY18. Similarly, Hindustan Organic
Chemicals earned net profit of 54.01 crore in FY19 as against net loss of187 crore in FY18. Also, there are some companies
that incurred net loss in FY19 as against net profit in FY18.
NACL’s net loss in FY19 stood at 8.32 crore vs net profit of 10.63 crore in FY18. Konoria Chemicals too incurred net loss
of 19.5 crore in FY19 as against net profit of11.57 crore in
FY18.
The demand for chemicals has been on the rise since last few
years, which is reflecting in terms of growth in volumes.
Overall, the growth in profits and margins has been on the rise
and is expected to grow going forward.
With China implementing stringent environmental norms,
many Chinese capacities are shutting down, which is
benefitting large organised Indian players. Large global
chemical sourcing chains are forced to look at India as an
alternative market. Also, the trade disputes and anti-dumping
duty by the US on Chinese imports added to the difficulties.
But this has also opened huge opportunities for the Indian
players.
The Indian government has approved four Petroleum,
Chemical and Petrochemical Investment Regions (PCPIRs)
across India that are intended to emerge as hubs improving
efficiencies and collaboration with the aim of competing with
recognised global hubs.
According to the Indian Chemical Council, specialty chemicals
demand is growing at a fast pace and the sector requires
investment, technology, local application development and
R&D. The opportunity in this segment is tremendous and
India, with its strong respect for intellectual property rights
(IPR), is well suited for hi-tech chemical to invest and enjoy
long-term sustainable growth. Also, the crude oil price
movements and trade flow changes across globe are expected to
have no impact on India as the domestic market is strong in
India.
All the key segments of specialty chemicals are set for double
digit growth over the coming five years, including a CAGR of
13 per cent in personal care and 10 per cent in paints and
coatings, according to India Ratings and Research.
The industry in India is expected to grow at around 9 per cent
per annum to reach USD 304 billion by FY25, from USD 163
billion in FY18, a report said. The growth is likely to be driven
by rising demand in end-use segments for specialty chemicals
and petrochemicals intermediates, said the India Chem
Strategy report by Tata Strategic Group, brought in association
with leading industry body FICCI.
15 Companies - Stock Performance for FY19
Company Name Price as on March 29, 2019 Price as on March 28, 2018 % Change
Gujarat Fluorochemicals Ltd. 1104.70 780.60 41.52
Aarti Industries Ltd. 1573.10 1144.20 37.48
Atul Ltd. 3572.90 2622.00 36.27
Pidilite Industries Ltd. 1242.35 918.50 35.26
Asian Paints Ltd. 1491.90 1120.70 33.12
UPL Ltd. 637.33 485.37 31.31
Berger Paints India Ltd. 323.65 256.45 26.20
PI Industries Ltd. 1031.30 887.90 16.15
Solar Industries (India) Ltd. 1076.30 1072.90 0.32
Akzo Nobel India Ltd. 1788.25 1798.00 -0.54
Godrej Industries Ltd. 536.05 547.90 -2.16
Kansai Nerolac Paints Ltd. 457.25 504.20 -9.31
Tata Chemicals Ltd. 587.50 676.75 -13.19
Himadri Speciality Chemical Ltd. 117.15 146.60 -20.09
Jubilant Life Sciences Ltd. 664.20 839.80 -20.91
martin jones
(Martin Jones)
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