#PAT #GROWTH
In FY25, PAT declined by 12% YoY to โน909 cr because of deferred tax adjustments in FY24, which created a high base effect. The PBT grew by 32% YoY. In Q1 FY26, PAT stood at โน291 cr, up by 5% YoY and 32% QoQ. On a sequential basis, the growth was driven by lower depreciation and finance cost.
In FY25, PAT declined by 12% YoY to โน909 cr because of deferred tax adjustments in FY24, which created a high base effect. The PBT grew by 32% YoY. In Q1 FY26, PAT stood at โน291 cr, up by 5% YoY and 32% QoQ. On a sequential basis, the growth was driven by lower depreciation and finance cost.
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#EBITDA #MARGIN
In FY25, the EBITDA margin expanded by 18 bps YoY to 12.3% mainly on account of lower other expenses as a percentage of sales. In Q1 FY26, the EBITDA margin contracted by 38 bps YoY and expanded by 67 bps QoQ to 13.1%. It declined on a YoY basis mainly on account of specialty alloy.
In FY25, the EBITDA margin expanded by 18 bps YoY to 12.3% mainly on account of lower other expenses as a percentage of sales. In Q1 FY26, the EBITDA margin contracted by 38 bps YoY and expanded by 67 bps QoQ to 13.1%. It declined on a YoY basis mainly on account of specialty alloy.
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#COMPANY #POTENTIAL
โข Indiaโs finished steel consumption is anticipated to increase to 230 million tonnes (MT) by FY31. โข There is an investment opportunity as this sector is witnessing consolidation of companies, which has led to investment by companies from other sectors. This further provides an opportunity for the global players to invest into Indian market. โข Various Governmentโs initiatives drive growth in the sector such as National Steel Policy (NSP) 2017, which was implemented to encourage the industry to reach global benchmarks. In July 21, the Union Cabinet approved the Production Linked Incentive (PLI) scheme for speciality steel. The scheme is expected to attract investment worth ~โน400 billion. โข Indian railways has proposed to spend โน2โโโlakh crore a year till FY2023-24 to upgrade infrastructure, providing opportunities for increased demand of rail steel. โข The opening of the mining sector and rapid investment in the infrastructure sector is expected to result in a growth in capital goods which consumes nearly 15 percent of the domestic steel produced. โข The Indian Army, Navy and Air Force along with Defense Research and Development Organization (DRDO) and the Ordinance Factory have expressed great potential for domestic fulfilment of special steel alloy requirements in the defense sector. โข Under housing for all by 2022 scheme, 10-12 million houses and 29.5 million units in rural areas are to be constructed with potential steel demand of 50-60 MT.
โข Indiaโs finished steel consumption is anticipated to increase to 230 million tonnes (MT) by FY31. โข There is an investment opportunity as this sector is witnessing consolidation of companies, which has led to investment by companies from other sectors. This further provides an opportunity for the global players to invest into Indian market. โข Various Governmentโs initiatives drive growth in the sector such as National Steel Policy (NSP) 2017, which was implemented to encourage the industry to reach global benchmarks. In July 21, the Union Cabinet approved the Production Linked Incentive (PLI) scheme for speciality steel. The scheme is expected to attract investment worth ~โน400 billion. โข Indian railways has proposed to spend โน2โโโlakh crore a year till FY2023-24 to upgrade infrastructure, providing opportunities for increased demand of rail steel. โข The opening of the mining sector and rapid investment in the infrastructure sector is expected to result in a growth in capital goods which consumes nearly 15 percent of the domestic steel produced. โข The Indian Army, Navy and Air Force along with Defense Research and Development Organization (DRDO) and the Ordinance Factory have expressed great potential for domestic fulfilment of special steel alloy requirements in the defense sector. โข Under housing for all by 2022 scheme, 10-12 million houses and 29.5 million units in rural areas are to be constructed with potential steel demand of 50-60 MT.
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#COMPANY #OUTLOOK
โข The company is increasing its combined production capacity from ~13.66 MTPA to 22.99 MTPA by FY27. This would include beneficiation plant of 3 MTPA, Billets (heavy structural mill) 0.4 MTPA, parallel flange beams 0.4 MTPA, colour coated Sheet 0.4 MTPA, sponge iron 1.2 MTPA, blast furnace 1.05 MTPA, coke oven 0.7 MTPA, DI Pipe 0.6 MTPA and others. โข They are looking to increase the power generation in the captive power plant by 340 MW, resulting in a capacity growth from 357 MW to 697 MW. This will contribute ~85% to the total power requirements of the company, in the coming period. โข The companyโs low carbon ferro chrome project had been commissioned and ~70% of revenue from this project is through exports. The management plans to double its capacity in next 1 year. โข They have now taken control over Ramsarup Industries Ltd. The acquisition was carried out via SS Natural Resources Pvt Ltd, a special purpose vehicle (SPV) in which the company holds 60% stake. The acquisition would help the company in improving its infrastructure facilities and build a new product mix. They would be incurring a total capex of โน747 crore for its revival. โข The contribution from the value-added product in revenue is expected to move up to 80% of the revenue in next 5 years from the present contribution of more than 50% to the revenue. โข They announced the expansion of its production capabilities with the establishment of a greenfield Cold Rolling Mill (CRM) in Jamuria, West Bengal. It will have a total capacity of 0.4 MT annually. The project has a total capital cost of โน603 cr, with โน346 cr invested and โน257 cr pending. The mill will specialize in producing pre-painted galvalume coils (PPGL) and coils of galvanized iron/galvanized steel (GI/GL). โข The company will expand its stainless-steel production capacity from 1.5 lakh ton to 6 lakh ton in the next 5 years.
โข They will also expand its carbon steel production capacity to 3.6 MT from 2.32 MT in next 2-3 years. โข They have commissioned the color coated complex. In the color coated sheet, the EBITDA per ton is expected to be โน5,500-โน6,500 in the coming period. The complete operations of the same will commence from December-January 2025 onwards. โข The company will spend โน1,160 cr over next 3 years to increase stainless steel capacity. โข The DI pipe plant is going to be commissioned in FY26. โข The company has signed the MOU (Memorandum of understanding) in aluminum foil business for EV batteries with the best of the battery manufacturers in the country and are expecting that they will be in full swing from FY25-FY26. โข The company is aiming to achieve 15%-17% CAGR for sales, over the next 4-5 years. It will be driven by expansion in aluminum products & stainless steel, enhancing value of long products and focus on B2C (business to consumer) business.
โข The company is increasing its combined production capacity from ~13.66 MTPA to 22.99 MTPA by FY27. This would include beneficiation plant of 3 MTPA, Billets (heavy structural mill) 0.4 MTPA, parallel flange beams 0.4 MTPA, colour coated Sheet 0.4 MTPA, sponge iron 1.2 MTPA, blast furnace 1.05 MTPA, coke oven 0.7 MTPA, DI Pipe 0.6 MTPA and others. โข They are looking to increase the power generation in the captive power plant by 340 MW, resulting in a capacity growth from 357 MW to 697 MW. This will contribute ~85% to the total power requirements of the company, in the coming period. โข The companyโs low carbon ferro chrome project had been commissioned and ~70% of revenue from this project is through exports. The management plans to double its capacity in next 1 year. โข They have now taken control over Ramsarup Industries Ltd. The acquisition was carried out via SS Natural Resources Pvt Ltd, a special purpose vehicle (SPV) in which the company holds 60% stake. The acquisition would help the company in improving its infrastructure facilities and build a new product mix. They would be incurring a total capex of โน747 crore for its revival. โข The contribution from the value-added product in revenue is expected to move up to 80% of the revenue in next 5 years from the present contribution of more than 50% to the revenue. โข They announced the expansion of its production capabilities with the establishment of a greenfield Cold Rolling Mill (CRM) in Jamuria, West Bengal. It will have a total capacity of 0.4 MT annually. The project has a total capital cost of โน603 cr, with โน346 cr invested and โน257 cr pending. The mill will specialize in producing pre-painted galvalume coils (PPGL) and coils of galvanized iron/galvanized steel (GI/GL). โข The company will expand its stainless-steel production capacity from 1.5 lakh ton to 6 lakh ton in the next 5 years.
โข They will also expand its carbon steel production capacity to 3.6 MT from 2.32 MT in next 2-3 years. โข They have commissioned the color coated complex. In the color coated sheet, the EBITDA per ton is expected to be โน5,500-โน6,500 in the coming period. The complete operations of the same will commence from December-January 2025 onwards. โข The company will spend โน1,160 cr over next 3 years to increase stainless steel capacity. โข The DI pipe plant is going to be commissioned in FY26. โข The company has signed the MOU (Memorandum of understanding) in aluminum foil business for EV batteries with the best of the battery manufacturers in the country and are expecting that they will be in full swing from FY25-FY26. โข The company is aiming to achieve 15%-17% CAGR for sales, over the next 4-5 years. It will be driven by expansion in aluminum products & stainless steel, enhancing value of long products and focus on B2C (business to consumer) business.
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Shyam Metalics and Energy Limited 720-820
Expected level 1060
Support 630
Expected level 1060
Support 630
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Fine Organics company details report
Fine Organics Incorporated in 2002, Fine Organics is the manufacturer of oleochemical based additives in India and a renowned player globally. The company produces a wide range of specialty plant derived oleochemical based additives used in the food, plastic, cosmetics, paint, ink, coatings and other specialty application in various industries. Fine Organics is the first company to introduce slip additives in India and is the largest producer of slip additives in the world. Food additives: The company caters to the food industry requirements with its additives such as Emulsifiers, Antifungal additives and other additives/blends. These food additives help maintain food quality, keep food fresh, improved product structural integrity and increase the shelf life of foods like breads, cakes and bakery products, preventing spoilage or hazardous growth of bacteria and yeast and moulds. Overall, the company manufactures a total of 33 food grade additives, and the market for the same is spread across the globe including developed countries. Plastic additives: The company develops a huge range of additives such as dispersing agents, multifunctional processing aids, antistats, melt flow improvers, lubricants, antifogging additives for the applications ranging from polymers, polymer compounds/ masterbatches, foamed products, PVC products and engineering plastics. These plastic additives provide a variety of functionalities: Slip additives that reduce surface friction between plastic film-to-film surfaces and film-to-metal surfaces; antistats help to dissipate static charges to make plastic safer to handle; and anti-fogs that improve visibility through plastic films. Overall, it manufactures a wide range of additive products.
Fine Organics Incorporated in 2002, Fine Organics is the manufacturer of oleochemical based additives in India and a renowned player globally. The company produces a wide range of specialty plant derived oleochemical based additives used in the food, plastic, cosmetics, paint, ink, coatings and other specialty application in various industries. Fine Organics is the first company to introduce slip additives in India and is the largest producer of slip additives in the world. Food additives: The company caters to the food industry requirements with its additives such as Emulsifiers, Antifungal additives and other additives/blends. These food additives help maintain food quality, keep food fresh, improved product structural integrity and increase the shelf life of foods like breads, cakes and bakery products, preventing spoilage or hazardous growth of bacteria and yeast and moulds. Overall, the company manufactures a total of 33 food grade additives, and the market for the same is spread across the globe including developed countries. Plastic additives: The company develops a huge range of additives such as dispersing agents, multifunctional processing aids, antistats, melt flow improvers, lubricants, antifogging additives for the applications ranging from polymers, polymer compounds/ masterbatches, foamed products, PVC products and engineering plastics. These plastic additives provide a variety of functionalities: Slip additives that reduce surface friction between plastic film-to-film surfaces and film-to-metal surfaces; antistats help to dissipate static charges to make plastic safer to handle; and anti-fogs that improve visibility through plastic films. Overall, it manufactures a wide range of additive products.
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The state-of-the-art manufacturing facilities of the company are located at Ambernath, Badlapur, Dombivli and Patalganga with combined capacities of more than 1,00,000 tonnes per annum. It has developed an in-house technology and processes supported by strong Research and Development (R&D), which results in delivering best quality products and new additives and its derivatives, as per the needs of the customers. As on 31st March 2024, the company had a range of 510+ different products sold under the โFine Organicsโ brand. As on 31st March 2024, the company has two subsidiaries, i.e., Fine Organics (USA), Inc. and Fine Organics Europe BV and three joint venture companies, i.e., Fine Zeelandia Private Limited, FineADD Ingredients GmbH and Fine Organic Industries (Thailand) Co., Ltd.
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#SALES #GROWTH
In FY25, the sales grew by 7% YoY to โน2,269 cr. Out of the total sales, domestic sales stood at 43% and export sales stood at 57%. During the year, the exports sales grew by 17% YoY to โน1,293 cr while domestic sales declined by 4% YoY to โน976 cr. The demand in the domestic market remained strong across all its product segment. On the export front, the company witnessed renewed momentum across global markets.
In FY25, the sales grew by 7% YoY to โน2,269 cr. Out of the total sales, domestic sales stood at 43% and export sales stood at 57%. During the year, the exports sales grew by 17% YoY to โน1,293 cr while domestic sales declined by 4% YoY to โน976 cr. The demand in the domestic market remained strong across all its product segment. On the export front, the company witnessed renewed momentum across global markets.
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#EBITDA #GROWTH
In FY25, the EBITDA declined by 4% YoY to โน513 cr. The EBITDA was impacted due to increase in raw material cost on account of sharp rise in prices for certain vegetable oils primarily in the domestic market from Q2 FY25 onwards, increase in freight cost and rise in power & fuel cost due to a rise in perunit charges in other expenses. Generally, the rise in prices of vegetable oils are attributable to many factors such as increase in buying by China, labour issues due to lockdowns in Indonesia and Malaysia, climatical impact on soya producing areas and imposing of import duties on palm oil in India.
In FY25, the EBITDA declined by 4% YoY to โน513 cr. The EBITDA was impacted due to increase in raw material cost on account of sharp rise in prices for certain vegetable oils primarily in the domestic market from Q2 FY25 onwards, increase in freight cost and rise in power & fuel cost due to a rise in perunit charges in other expenses. Generally, the rise in prices of vegetable oils are attributable to many factors such as increase in buying by China, labour issues due to lockdowns in Indonesia and Malaysia, climatical impact on soya producing areas and imposing of import duties on palm oil in India.
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#EBITDA #MARGIN
In FY25, the EBITDA margin contracted by 257 bps YoY to 22.6% due to increase in raw material cost, employee benefit expense and other expenses as a percentage of sales. Raw material cost increased on account of rise in vegetable oil prices. The prices of vegetable oil are determined by global and domestic demand-supply output, other climatic/crop factors, extensive usage in making bio diesel and sustainable aviation fuel and tariff changes implemented by the Indian Government and exporting countries cause price volatility.
In FY25, the EBITDA margin contracted by 257 bps YoY to 22.6% due to increase in raw material cost, employee benefit expense and other expenses as a percentage of sales. Raw material cost increased on account of rise in vegetable oil prices. The prices of vegetable oil are determined by global and domestic demand-supply output, other climatic/crop factors, extensive usage in making bio diesel and sustainable aviation fuel and tariff changes implemented by the Indian Government and exporting countries cause price volatility.
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#ROCE
In FY25, the return on capital employed stood at ~26.5%. New products launch supported by strong R&D capability has helped in improving operating profit and sustaining high return on capital employed of the company over the years. The return ratio was impacted in FY21 on account of raw material price fluctuation. In FY23, the return on capital employed improved on account of higher earning due to better operating margin as compared to previous year and repayment of debt.
In FY25, the return on capital employed stood at ~26.5%. New products launch supported by strong R&D capability has helped in improving operating profit and sustaining high return on capital employed of the company over the years. The return ratio was impacted in FY21 on account of raw material price fluctuation. In FY23, the return on capital employed improved on account of higher earning due to better operating margin as compared to previous year and repayment of debt.
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#ROE
In FY25, the return on equity stood at ~19.5%. This company has healthy and stable return on equity over the years. Going forward, improvement in utilization and better margin with increased share from higher valueadded products would help in improving the return ratios of the company.
In FY25, the return on equity stood at ~19.5%. This company has healthy and stable return on equity over the years. Going forward, improvement in utilization and better margin with increased share from higher valueadded products would help in improving the return ratios of the company.
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#COMPANY #POTENTIAL
โข The global oleochemicals market is valued at $37.88 billion in 2023. In FY24, the market is anticipated at ~$40.37 billion and it is estimated to reach at $65.38 billion in 2030. Oleochemicals finds application in numerous major fields including polymers, pharmaceutical, personal care, soaps & detergents, food & beverages and others. The use of oleochemical in personal care sector is estimated to grow due to its cost-efficiency and rising awareness of natural chemicals. The growing adoption of oleochemicals by chemical manufacturers to produce bio-surfactants, bio-lubricants and bio-polymers as sustainable alternatives to the petrochemicals is a major growth driver. Industry โข Foods โข Plastics Segments: : The global food additives market size is projected to grow from an estimated US$ 141 million in 2024 to US$ 167.88 million by 2029, registering a CAGR of 3.55% during the forecast period (2024-2029). This growth is driven by several factors, including the increasing popularity of functional foods, the growth of the processed food industry, and the rising demand for convenience foods. Additionally, increased awareness of food safety standards and the desire for extended shelf life are contributing to the marketโs upward trajectory. and Packaging: The plastic additives market is undergoing significant growth, driven by various factors such as the expansion of the packaging industry, changing lifestyles, urbanization trends, and increased plastic usage across different sectors. With a forecasted CAGR of 5.3% between 2023 and 2030, the market indicates sustained momentum. Moreover, the Asia-Pacific region dominated the market in 2023, holding a substantial share of 55%. The growth factor mainly include increased demand in the packaging industry as it is used in a variety of industrial and household applications.
โข Additionally, owing to the growing population, rapid urbanisation and rising middle-class incomes, APAC countries are expected to witness robust demand for Plastic additives in Automotive, Electronic & Electrical goods manufacturing and other specialty applications. โข Cosmetics and Pharmaceuticals: The world cosmetics market is anticipated to increase at a CAGR of 5.3% from 2021 to 2027. The growth has been driven by a growing consumer base due to strikingly increased awareness, rising disposable income, the surge in cosmetics manufacturing, expanding urbanisation, rapid adoption of cosmetic products among millennials and increasing ecommerce sales. โข Coating Additives: The global coating additives market is expected to grow at the rate of 5.5% CAGR from 2021 to 2030. The coating additives is anticipated to grow in automotive sector and paint industry.
โข The global oleochemicals market is valued at $37.88 billion in 2023. In FY24, the market is anticipated at ~$40.37 billion and it is estimated to reach at $65.38 billion in 2030. Oleochemicals finds application in numerous major fields including polymers, pharmaceutical, personal care, soaps & detergents, food & beverages and others. The use of oleochemical in personal care sector is estimated to grow due to its cost-efficiency and rising awareness of natural chemicals. The growing adoption of oleochemicals by chemical manufacturers to produce bio-surfactants, bio-lubricants and bio-polymers as sustainable alternatives to the petrochemicals is a major growth driver. Industry โข Foods โข Plastics Segments: : The global food additives market size is projected to grow from an estimated US$ 141 million in 2024 to US$ 167.88 million by 2029, registering a CAGR of 3.55% during the forecast period (2024-2029). This growth is driven by several factors, including the increasing popularity of functional foods, the growth of the processed food industry, and the rising demand for convenience foods. Additionally, increased awareness of food safety standards and the desire for extended shelf life are contributing to the marketโs upward trajectory. and Packaging: The plastic additives market is undergoing significant growth, driven by various factors such as the expansion of the packaging industry, changing lifestyles, urbanization trends, and increased plastic usage across different sectors. With a forecasted CAGR of 5.3% between 2023 and 2030, the market indicates sustained momentum. Moreover, the Asia-Pacific region dominated the market in 2023, holding a substantial share of 55%. The growth factor mainly include increased demand in the packaging industry as it is used in a variety of industrial and household applications.
โข Additionally, owing to the growing population, rapid urbanisation and rising middle-class incomes, APAC countries are expected to witness robust demand for Plastic additives in Automotive, Electronic & Electrical goods manufacturing and other specialty applications. โข Cosmetics and Pharmaceuticals: The world cosmetics market is anticipated to increase at a CAGR of 5.3% from 2021 to 2027. The growth has been driven by a growing consumer base due to strikingly increased awareness, rising disposable income, the surge in cosmetics manufacturing, expanding urbanisation, rapid adoption of cosmetic products among millennials and increasing ecommerce sales. โข Coating Additives: The global coating additives market is expected to grow at the rate of 5.5% CAGR from 2021 to 2030. The coating additives is anticipated to grow in automotive sector and paint industry.
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#COMPANY #OUTLOOK
โข In the food additives business, the company foresees its potential in the overseas market and going forward it is also optimistic about the growth arising from the domestic market. โข In the plastic additives business, it plans to expand its domestic reach. โข The companyโs Thailand joint venture has commenced production trials and is in the process of product standardization. This is a very small plant. Further investment decision would be determined after the performance of the trial production. โข The companyโs manufacturing unit in Badlapur, Maharashtra, resumed operations in Q3 FY25 after being disrupted since 18th January 2024, due to a fire incident at an adjacent plant. โข On 29th October 2024, the company signed a 60-year lease agreement for land at Jawaharlal Nehru Port Authority (JNPA) for its wholly owned subsidiary, Fine Organic Industries (SEZ) Private Limited. Once operational, this facility will manufacture products similar to the companyโs current portfolio, primarily targeting international markets due to its Special Economic Zone (SEZ) status. The company has applied for environmental clearance, which is currently in progress. โข The project is expected to entail a capital expenditure of ~โน750 cr, funded through a combination of debt and internal accruals. The commercial production at this new facility is slated to begin by FY27, strengthening the company's footprint in global markets.
โข In the food additives business, the company foresees its potential in the overseas market and going forward it is also optimistic about the growth arising from the domestic market. โข In the plastic additives business, it plans to expand its domestic reach. โข The companyโs Thailand joint venture has commenced production trials and is in the process of product standardization. This is a very small plant. Further investment decision would be determined after the performance of the trial production. โข The companyโs manufacturing unit in Badlapur, Maharashtra, resumed operations in Q3 FY25 after being disrupted since 18th January 2024, due to a fire incident at an adjacent plant. โข On 29th October 2024, the company signed a 60-year lease agreement for land at Jawaharlal Nehru Port Authority (JNPA) for its wholly owned subsidiary, Fine Organic Industries (SEZ) Private Limited. Once operational, this facility will manufacture products similar to the companyโs current portfolio, primarily targeting international markets due to its Special Economic Zone (SEZ) status. The company has applied for environmental clearance, which is currently in progress. โข The project is expected to entail a capital expenditure of ~โน750 cr, funded through a combination of debt and internal accruals. The commercial production at this new facility is slated to begin by FY27, strengthening the company's footprint in global markets.
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