FLUOROCHEM - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.0

📊 Core Financials Breakdown

Profitability

ROE: 9.28% and ROCE: 11.0% — moderate returns, acceptable for a specialty chemicals player but not industry-leading.

EPS: ₹59.1 — solid earnings base, with PAT growing from ₹167 Cr to ₹185 Cr, a 66.7% quarterly jump.

Debt-to-Equity: 0.31 — manageable leverage, typical for capital-intensive chemical manufacturing.

Dividend & Book Value

Dividend Yield: 0.08% — negligible, indicating reinvestment focus.

Book Value: ₹588 — implies a P/B ratio of ~6.3, high but justified by niche positioning and growth potential.

💰 Valuation Metrics

Metric Value Comment

P/E Ratio 62.9 Significantly above industry average (33.9) — priced for growth

PEG Ratio -7.13 Negative PEG suggests earnings volatility or distorted growth expectations

Intrinsic Value ~₹3,400–₹3,600 CMP slightly above fair value zone

Valuation is stretched, especially with a negative PEG and elevated P/E.

🧪 Business Model & Competitive Edge

Sector: Specialty Chemicals — fluoropolymers, fluoroelastomers, refrigerants, and fluorospecialty chemicals.

Strengths

Global footprint across India, Europe, and the U.S.

High-margin niche products with strong demand in EVs, semiconductors, and pharma.

DII holding up (+0.73%) — positive domestic sentiment.

Strong revenue growth: ₹48.42B annually with net income of ₹6.22B

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Challenges

FII holding down (-0.38%) — cautious foreign stance.

Recent safety incidents at Dahej and Panchmahal plants may impact sentiment

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PEG ratio and valuation multiples suggest growth expectations may be overbaked.

📉 Technicals & Entry Zone

Current Price: ₹3,716

DMA 50: ₹3,540 | DMA 200: ₹3,660 — bullish trend intact

RSI: 63.7 — approaching overbought zone

MACD: Positive — momentum strong

📌 Suggested Entry Zone: ₹3,400–₹3,600

A dip near the 200 DMA or intrinsic value would offer a better margin of safety.

🧭 Long-Term Holding Guidance

Hold if invested: Strong fundamentals, niche product portfolio, and global demand make FLUOROCHEM a solid long-term play.

Accumulate on dips: Ideal for investors seeking exposure to high-growth specialty chemicals with moderate risk.

UBS maintains a “Sell” rating citing slow EV ramp-up and soft Q4 performance

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, while retail sentiment remains bullish. You can explore FLUOROCHEM’s full financials and technical chart or review its analyst consensus and valuation metrics for deeper insights. Let me know if you'd like a peer comparison with Navin Fluorine or SRF.

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