30% of revenue and 70% from domestic market. Company is currently focusing on value added products (specialty chemical segment) and has...

Phillips Carbon Black (PCBL) reported a steady performance in a Covid impacted Q1FY21. Net sales for the quarter were at | 360 crore, down 61% YoY. Carbon black sales volume for the quarter came in at ~51,300 tonne, down 52% YoY with blended realisation at | 68/kg vs. | 83/kg in base quarter. PCBL reported positive EBITDA and PAT prints despite a steep decline in sales volume and value. EBITDA in Q1FY21 was at | 39 crore with EBITDA margins at 10.7% (EBITDA/tonne at ~| 7,500/tonne). PAT in Q1FY21 came in at | 2.3 crore. The company guided for near normalcy in operations...

Specialty grade CB is a margin accretive product and difficult to crack amid global dominance by a few players. PCBL, through its years of R&D; and capability building process, has made a mark in this field and clocked ~20,000 tonne (~5% of total CB sales volume) from this division in FY19. Going forward, with incremental capacities in place, the company is well poised to outperform its base business growth with speciality grade CB sales volume growing at a CAGR of 26% in FY19-22E to 40,000 tonne in FY22E (~9% of total volume). This will augment its EBITDA margins to 15.6% in...

Phillips Carbon Black (PCBL) reported a de-growth of 2% YoY in top-line at `8630mn led by lower revenue in carbon black segment. Sales volume in both rubber carbon black and specialty carbon black segment improved 2-4% YoY however pricing pressure in specialty...

Higher share of replacement demand in tyre to protect volumes Carbon black is used as a reinforcing agent in manufacturing tyres and constitutes ~26% of tyre by volume. Tyres industry by virtue of having higher share of replacement demand (~60% of sales) vs. the OEM sales (~30% of sales) is somewhat insulated from the prevailing slump in vehicle sales domestically and is expected to steadily grow at a CAGR of 7%+. This ensures healthy carbon black demand with PCBL as a natural beneficiary which is a market leader domestically with a market share of ~35%....

Phillips Carbon Black Ltd's (PCBL) Q4FY19 results were below our expectations, as this quarter's sales were impacted by sharp slowdown in the domestic auto sector

Volume growth to revive, exports at the rescue! PCBL is a leading CB player with domestic market share at ~35%. It clocked CB sales volume of ~402 KT, flat YoY. As of FY18 end it had an effective capacity of ~441 KT. It operated at 90%+ utilisation levels and largely missed out on robust auto demand in H1FY19 due to lack of capacity. PCBL commissioned a brownfield expansion amount to ~56 KT in Q4FY19 and is well poised for volume led growth, going forward. With muted domestic auto demand prospects, PCBL is banking on exports to push volumes. We...

Incremental capacities in place, volume led growth to follow PCBL after successfully commissioning a 56kT rubber black line it has augmented its effective carbon black capacity to ~4.9 lakh tonne in Q3FY19 from ~4.1 lakh tonne in FY17. Furthermore, the company is aggressively strengthening its specialty carbon black capacity by adding 15kT line in Q2FY20E and another 32kT line in Q4FY20E.Despite the incremental capacities in place production in FY19E is expected to reach ~4.11 lakh tonne, up ~2% YoY mainly due to maintenance shutdowns, one off events and change in product mix. However, given the tightness in domestic carbon black...

Phillips Carbon Black Limited (PCBL) reported consolidated Q3FY19 sales at INR 946 cr up 54% YoY.

ICICI Securities Ltd | Retail Equity Research Phillips Carbon Black (PCBL) reported a steady Q3FY19 performance Net sales in Q3FY19 were at | 945.9 crore, up 54% YoY, primarily led by realisations that came in at | 90/kg vs. | 59/kg in base quarter (Q3FY18). Realisations were driven by an increase in crude price and consequent CBFS price amid rupee depreciation on a YoY basis Sales volume of carbon black in Q3FY19 were at 102 KT, up 1% YoY EBITDA in Q3FY19 was at | 178.8 crore with corresponding EBITDA...

Phillips Carbon Black Limited (PCBL) reported consolidated Q2FY19 sales at INR 880 cr up 47% YoY

Phillips Carbon Black (Phillips) reported strong improvement in EBITDA/tonne (+38% QoQ) to Rs16k/tonne on price hike (Rs 3k/tonne), better product mix and operational efficiencies. Although total volumes at 99k tonnes were slightly below our estimate, its specialty volumes grew to 6k tonnes (2k tonnes in Q1FY18). EBITDA rose 67.9% YoY and 46.7% QoQ to Rs1,659 mn (better than our estimate of Rs1,404 mn). Net profit jumped...

Phillips Carbon Black Limited (PCBL) reported consolidated Q1FY19 sales at INR 781 cr up 33% YoY driven by price hike taken for tyre customers and increased sales of high end specialty carbon black

Further to our Research report dated October 27th 2016, wherein we had recommended a BUY at the then price of Rs. 51.50(Split adjusted), the share price had reached its all time high to Rs. 318.98 increased by ~500% in January 2018. The company has been steadily moving towards new highs with strong financial outlook. On the back of robust...

Outlook: We believe Phillips is likely to be a key beneficiary of shortage of carbon black in India. Further, management's strategy of increasing its volumes in favour of high margin specialty products is likely to drive 23%/32% in EBITDA/PAT over FY1820E. We maintain our BUY rating on the stock with a revised target price of Rs348...

Phillips Carbon Black Limited (PCBL) reported consolidated Q4FY18 sales at INR 753 cr up 37% YoY driven by higher realisation from pass through of CBFS prices (up ~23% YoY) in rubber carbon...

Net sales in Q4FY18 were at | 753.0 crore, incorporating 5% YoY volume growth with carbon black (CB) sales volume at 103 KT Carbon black realisations for Q4FY18 were at US$1087/tonne (| 70.6/kg) vs. US$805/tonne (| 54.0/kg) in Q4FY17 EBITDA in Q4FY18 was at | 102.0 crore with corresponding EBITDA margins at 13.5%. EBITDA/tonne in Q4FY18 was at | 9903/tonne Margins came in a tad lower primarily tracking the management's accounting approach of expensing out the de-bottlenecking exercise...

ICICI Securities Ltd | Retail Equity Research Phillips Carbon Black (PCBL) has executed a stock split in the ratio of 1:5 i.e. existing one share of PCBL (priced at | 1128 as of April 18, 2018) of face value | 10/share is sub-divided into five equity shares (priced at | 236 as of April 19, 2018 opening) of face value | 2/share. The record date for the same is April 20, 2018 while the ex-date for the same is today i.e. April 19, 2018. Consequently, incorporating the stock split, we revise our target price to | 340/share, offering a healthy upside 44% from the current level....

Phillips Carbon Black Limited (PCBL) reported consolidated Q3FY18 sales at INR 612 cr up 26% YoY driven by pass through of higher CBFS prices in rubber carbon black and increased sales of high...

Capacity expansion plans updated: The company remains on-track to add 30 kt capacity by FY18 and another 48 kt by FY19 with a total capex of Rs3,000 mn. Further, the company has now raised its capacity expansion plan for high-margin specialty carbon black from 24kt earlier to 56kt by FY19. Accordingly, we have raised our FY18/FY19 EBITDA/PAT to account for higher volumes and better realizations given rising supply constraints (on shortage of raw material, coal tar in China). Outlook: While Phillip's fund-raising plans may dilute its EPS in the near-term and will be a key overhang on the stock in the near-term, nevertheless, we believe its...