Downgrades

Sudarshan Chemical Industries’ (SCIL) Q1FY25 print was slightly weaker than expected with pigment revenue growing only 10% YoY (down 8.4% QoQ on seasonality) while RIECO revenue dipped 38% YoY.

Sudarshan Chemical Industries’ (SCIL) Q1FY24 print showed recovery in margins (partly optical with drop in prices) on lower input cost. India demand was impacted from destocking in coating segment while plastics business has started growing. International business revenue was impacted from macro-headwinds.

Sudarshan Chemical Industries’ (SCIL) Q3FY23 print is far from positive – hurt as it was from weak demand across categories. India demand is expected to bounce back in Q4FY24 with restocking demand in plastics, and coatings sales to normalise. Exports looks challenging though opening-up of China market can exert a positive impact as local China demand recovers and competitive intensity in export markets reduces.

Sudarshan Chemical Industries’ (SCIL) Q2FY23 revenue grew 6.1% YoY which was largely driven by pricing, while volumes have declined.

Sudarshan Chemical Industries’ (SCIL) Q1FY23 EBITDA dipped 33% YoY, which was disappointing, due to lower revenue and higher opex.

Largely Unaffected Q4; Lockdown likely to impact Q1FY21 earnings We expect the companies under our chemicals coverage to report revenue growth of ~4.2% in Q4FY20 with 7.3% growth in profitability, driven by the benefit of price increase in few chemicals and reduction in the tax rate. Chemicals being basic building blocks of end-user applications are most likely to feel the slowdown in demand due to nationwide restricted movement. Indian chemical companies' have a raw material dependency on China. Still, most companies have adequate inventory to cater to demand in the near-term (at least for the current quarter). With the gradual resumption of work in Chinese factories, supply issues are expected to resolve. Additionally, crude derivatives as raw material for chemical companies will be positive for the gross margins given the drop in oil prices....

Since the Coronavirus issue outbreak in China, technical/key input prices like H Acid, Vinyl sulphone surged at least 30-50% in a month. This is largely owing to the fact that Wuhan is considered one of the largest manufacturer of dye intermediates. However, we believe the recent price increase is largely sentimental in nature. Once China comes back into production, we expect to see a softening in key input prices. India had witnessed Vinyl sulphone imports of mere | 47 crore from China in FY19 while exports remained at | 740 crore of which exports to China were at | 299 crore...

The company has been revamping unit I at MIDC Lote Parshuram with a capex of | 5 crore. SPCFL' management believes this revamp will curb revenues by | 55-60 crore in FY20 while the same is expected to recover in FY21 due to introduction of new products. We also expect this to improve...

The board has given approval for expansion in the capacity of dyestuff at both Vadodara (1600 TPM) and Ahmedabad plant (400 TPM). We expect this to result into visibility in the volume growth post FY21. Further, the company is also entering into caustic soda business with a capacity of 300 TPD, translating into stability in the realisation growth to some extent in long run. However, any disruption from China could put pressure on realisation growth for entire capacity and thereby can curtail operating margins. Total capex for dyestuff, S Acid and caustic soda is earmarked at | 1023 crore with...

EBITDA in Q2FY19 came in at | 19.4 crore (up 11.5% YoY), with corresponding EBITDA margins at 16.8% Margins came in slightly muted against our expectation amid an increase in prices of dye intermediates in the recent past PAT in Q2FY19 was at | 12.3 crore, up 18.2% YoY, driven by higher sales & supported by lower effective tax rate, which came in at 27.0% Reducing share of dye intermediates to provide stable margins profile! SPCL is an integrated manufacturer of textile chemicals wherein the...

ICICI Securities Ltd | Retail Equity Research Shree Pushkar Chemicals & Fertilisers Ltd (SPCL) reported muted Q4FY18 performance at the standalone level primarily driven by muted realisations and high raw material prices in the dye intermediates space. Net sales in Q4FY18 stood at | 102.0 crore. EBITDA in Q4FY18 came in at | 9.7 crore (down 32.0% YoY) with corresponding EBITDA margins at 9.5% (down 600 bps YoY). PAT in Q4FY18 stood at | 6.3 crore, down 23.0% YoY partly aided by...

Sudarshan Chemical Industries Ltd. (Sudarshan) reported standalone Q4FY18 sales of INR 384 cr (INR 405 cr inclusive of discontinued operations of agrochemicals and its subsidiary Prescient Colors Ltd.

Bodal is the largest integrated manufacturer of dyestuff and dyeintermediates in India. It has undertaken multiple expansions in its core business and diversified areas with subsequent ramp expected to fuel next leg of growth in FY19E-20E As of 9MFY18, its core business of dyestuff and dye intermediates continued to witness satisfactory growth in volume terms However, partial resumption of Chinese capacity in FY18E led to softening of product realisations (down 10% YoY) thereby resulting in marginal decline in topline in FY18E (absolute basis)...

Sudarshan Chemical Industries Ltd. (Sudarshan) reported standalone Q2FY18 sales of INR 352 cr, 7% below our estimates but up 6% YoY.

Sudarshan Chemical Industries Ltd. (Sudarshan) reported standalone Q4FY17 sales at INR 334 cr, 5% below our estimates but up 5% YoY.