⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
FLUOROCHEM - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.7
| Stock Code | FLUOROCHEM | Market Cap | 32,590 Cr. | Current Price | 2,970 ₹ | High / Low | 4,098 ₹ |
| Stock P/E | 46.6 | Book Value | 620 ₹ | Dividend Yield | 0.10 % | ROCE | 11.0 % |
| ROE | 9.28 % | Face Value | 1.00 ₹ | DMA 50 | 3,398 ₹ | DMA 200 | 3,567 ₹ |
| Chg in FII Hold | -0.05 % | Chg in DII Hold | 0.08 % | PAT Qtr | 195 Cr. | PAT Prev Qtr | 185 Cr. |
| RSI | 23.5 | MACD | -143 | Volume | 20,457 | Avg Vol 1Wk | 87,402 |
| Low price | 2,917 ₹ | High price | 4,098 ₹ | PEG Ratio | -5.28 | Debt to equity | 0.22 |
| 52w Index | 4.52 % | Qtr Profit Var | 35.4 % | EPS | 63.7 ₹ | Industry PE | 26.3 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT increased from 185 Cr. to 195 Cr., showing modest sequential growth with 35.4% YoY variation.
- Margins: ROE at 9.28% and ROCE at 11.0% reflect moderate profitability, below industry leaders.
- Debt Ratios: Debt-to-equity at 0.22 indicates manageable leverage.
- Cash Flows: Stable operating cash flows supported by specialty chemicals and fluorochemicals demand.
- Return Metrics: EPS at 63.7 ₹ highlights decent earnings power but not aligned with high valuation multiples.
💹 Valuation Indicators
- P/E Ratio: 46.6, significantly above industry PE of 26.3, suggesting overvaluation.
- P/B Ratio: ~4.8 (Current Price / Book Value), reflecting premium valuation relative to assets.
- PEG Ratio: -5.28, distorted due to uneven growth expectations, signaling caution.
- Intrinsic Value: Current price (2,970 ₹) appears overvalued; better entry opportunities may arise closer to 2,900 ₹.
🏢 Business Model & Competitive Advantage
- Operates in specialty chemicals and fluorochemicals with global exports.
- Competitive advantage lies in niche product portfolio, regulatory approvals, and strong demand in refrigerants and specialty gases.
- Resilient business model but margins are sensitive to raw material costs and global demand cycles.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 2,850 ₹ – 2,950 ₹ (near 52-week low and below DMA 50).
- Long-Term Holding: Suitable for long-term investors seeking exposure to specialty chemicals, though valuations are stretched and profitability needs improvement.
Positive
- Debt-to-equity ratio at 0.22 shows manageable leverage.
- Strong YoY profit growth of 35.4%.
- EPS of 63.7 ₹ indicates steady earnings.
- Institutional inflows (DII +0.08%) provide support.
Limitation
- High P/E ratio compared to industry average.
- ROE and ROCE are modest relative to peers.
- PEG ratio signals poor growth-adjusted valuation.
- Dividend yield at 0.10% is negligible.
Company Negative News
- Reduction in FII holdings (-0.05%) shows cautious foreign investor sentiment.
- Weak technical indicators (RSI 23.5, MACD -143) reflect bearish momentum.
Company Positive News
- Quarterly PAT growth despite challenging conditions.
- Strong demand for specialty chemicals and fluorochemicals.
Industry
- Specialty chemicals sector benefits from global demand in refrigerants, gases, and niche applications.
- Industry PE at 26.3 reflects moderate optimism and fair valuations.
Conclusion
- Fluorochem is a fundamentally stable company with niche product strength and global demand support.
- Valuation is stretched, limiting near-term upside.
- Best suited for long-term investors seeking exposure to specialty chemicals, with entry near lower support levels for better risk-reward.
I can also contrast Fluorochem’s valuation and profitability with peers like Navin Fluorine or SRF to highlight its relative positioning in the specialty chemicals sector.