Privi Speciality Chemicals Ltd. share price target

The stock is currently not under our coverage and we do not have a view on the same. The stock currently trades at 77x of its FY24 EPS

Fairchem Speciality Limited (FSL), a Fairfax company, is an exclusive formation of specialty chemicals company from the merger of Adi Finechem Ltd (manufacturer of oleochemicals and nutraceuticals) and Privi Organics India Ltd (manufacturer of Aroma chemicals). The combined entity caters to various industries ranging from printing inks, paints, adhesives & paper coatings, flavors & fragrance, pharmaceuticals, and FMCG. FSL possesses manufacturing capacity of 45000 MTPA of Adi and 22000 MTPA of Privi located in Western India with more than 65 products in its basket. FSL's exquisite business model of processing finished goods from waste products serves as a platform for organic as well as inorganic growth in the area of specialty chemicals. Going forward, global market for oleochemicals / nutraceuticals / aroma chemicals is projected to grow at 6% / 7% / 7% CAGR over FY17-20E. Given FSL's dominant presence in all three segments coupled with company's capex plan to the tune of INR 2600 mn over FY17-FY20E, we believe the...

Unique Business Structure and better product mix provides edge to the AFL AFL is has unique product portfolio of Dimer acid, Linoleic acids and natural vitamin E. These fatty acids are widely used in mainly industries like paints, inks, textiles, lubricants etc. AFL has a low cost of manufacturing and their quality is also at par or better in many cases with Chinese and European suppliers. This provides edge to the company over other competitors. AFL makes this product by using relatively cheaper raw material which is a by-product of refinery (Acid Oil) whereas world at large makes them from virgin Vegetable oils or Tall Oils. These products are widely used in the paints, inks, lubricant industry. These agents are served as primary...