PCBL - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 3.8

📊 PCBL (Phillips Carbon Black Ltd) — Investment Analysis

✅ Strengths

ROE (12.5%) & ROCE (11.9%): Moderate capital efficiency, acceptable for a mid-cap industrial stock.

Dividend Yield (1.41%): Offers some income, though not high.

Low PEG Ratio (28.2): Indicates overvaluation relative to earnings growth.

Debt-to-Equity (1.51): High leverage, but manageable given stable cash flows.

Industry PE (37.6) vs Stock PE (35.9): Slightly undervalued compared to peers.

⚠️ Weaknesses

Quarterly Profit Decline: PAT dropped from ₹100 Cr to ₹94 Cr (QoQ -6%).

Technical Weakness: RSI at 39.9 and MACD negative — bearish momentum.

Volume Drop: Current volume significantly below 1-week average, indicating waning interest.

📈 Ideal Entry Price Zone

Current Price: ₹391

52-Week Range: ₹305 – ₹584

Suggested Entry Zone: ₹330 – ₹370

This range aligns with historical support and offers better risk-reward.

RSI and MACD suggest potential for further downside before reversal.

🧭 Long-Term Investment Outlook

PCBL is transitioning from a commodity carbon black player to a specialty chemicals manufacturer, which could unlock margin expansion and valuation re-rating.

Price Targets (Machine Learning Estimates)

Year Target 1 Target 2

2025 ₹493 ₹501

2026 ₹767 ₹778

2027 ₹1,022 ₹1,037

Growth Drivers

Expansion into high-margin specialty chemicals

Strategic land acquisition for new facilities

Strong relationships with global tire manufacturers

🛣️ Exit Strategy (If Already Holding)

If Bought Above ₹500

Exit near ₹470–₹500 on rallies.

Reinvest in lower-PEG, higher-ROE stocks.

If Bought Below ₹350

Hold for 3–5 years, targeting ₹750–₹1,000.

Consider partial profit booking near ₹600–₹650.

Monitoring Metrics

ROE/ROCE improvement (target >15%)

Debt reduction trajectory

Quarterly PAT growth

Specialty segment contribution to EBITDA

Would you like a comparison with other specialty chemical players like Galaxy Surfactants or Alkyl Amines to benchmark PCBL’s potential?

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