Phillips Carbon Black (PCBL) reported a robust Q1FY17 performance; largely tracking our investment thesis. Net sales for the quarter were at | 430.6 crore, down 10% YoY • EBITDA was at | 53.0 crore with corresponding EBITDA margins at 12.3%. PAT in Q1FY17 was at | 12.0 crore. Carbon black sales volume in Q1FY17 was at 95,500 tonne, which includes domestic sales of 76400 tonne and export sales of 19,100 tonne. Corresponding EBITDA/tonne in Q1FY17 was at | 5548 tonne.

ICICI Securities Limited expect PCB to report PAT of | 45.5 crore in FY17E & | 93 crore in FY18E. We value PCB at | 300, i.e. 11x P/E on FY18E EPS of | 27/share. We have a BUY rating on the stock.