PCBL - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.9

📊 Core Financials Analysis

Profitability

ROE: 12.8% and ROCE: 13.2% — decent, but not exceptional for a manufacturing company.

EPS: ₹11.3 — modest earnings, consistent with its mid-cap positioning.

Quarterly PAT: ₹93.1 Cr vs ₹94.8 Cr — stable, though recent profit variation is slightly negative (-19.9%).

Balance Sheet & Cash Flow

Debt-to-equity: 0.90 — moderately leveraged; manageable but worth monitoring.

Dividend Yield: 1.42% — modest income generation for shareholders.

Cash flow data isn’t provided, but stable PAT and moderate debt suggest operational sustainability.

📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 34.3 Slightly below industry average (36.7) — fairly valued

P/B Ratio ~3.9 Reasonable for a specialty chemicals firm

PEG Ratio 20.9 Extremely high — implies low earnings growth relative to valuation

Intrinsic Value Estimated ₹350–₹370 Current price slightly above fair value

🧠 Business Model & Competitive Edge

Core Business: PCBL (Phillips Carbon Black Ltd.) is India’s leading carbon black manufacturer, primarily serving the tire and rubber industries.

Expansion Strategy

Diversifying into specialty chemicals and nano-silica for EV batteries and performance materials

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Vision 2030: Targeting 2x revenue, 3x EBITDA, and 5x PAT through capex of ₹3,000 Cr

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Moat

Strong relationships with tire manufacturers.

Backward integration and sustainable manufacturing practices.

Entry into high-margin segments like conductive carbon and nano-silica for EVs.

📈 Technical & Sentiment Overview

RSI: 51.1 — neutral zone, no strong momentum.

MACD: 0.31 — flat, indicating consolidation.

DMA 50 & 200: Price hovering near both — trend indecisive.

Volume: Below weekly average — subdued trading interest.

💡 Entry Zone & Long-Term Guidance

Suggested Entry Range: ₹360–₹375 — near intrinsic value and technical support.

Holding Strategy

Long-term hold recommended for investors betting on India’s specialty chemical and EV material boom.

Monitor execution of capex plans and margin expansion in new segments.

Potential upside to ₹450–₹520 by 2025–2026 if growth targets are met

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PCBL is transitioning from a commodity player to a specialty chemicals innovator. If you’re patient and believe in the EV and performance materials story, this could be a rewarding compounder. Want to explore its nano-silica venture or compare it with other chemical stocks?

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marketinindia.com

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www.icicidirect.com

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trendlyne.com

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