BSE: 506655 | NSE: SUDARSCHEM | Dyes & Pigments | Small Cap
Past 10 year's financial track record analysis by Moneyworks4me indicates that Sudarshan Chemical Industries Ltd is a good quality company.
The key valuation ratios of Sudarshan Chemical Industries Ltd's currently when compared to its past seem to suggest it is in the Fair zone.
The Price Trend analysis by MoneyWorks4Me indicates it is Semi Strong which suggest that the price of Sudarshan Chemical Industries Ltd is likely to Rise-somewhat in the short term. However, please check the rating on Quality and Valuation before investing.
Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end.
Value Creation Index Colour Code Guide ⓘ
| Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 | TTM | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROCE % ⓘ | 16.5% | 18.8% | 20% | 16.6% | 24.4% | 19.4% | 17.1% | 12.9% | 6.3% | 31.5% | - |
| Value Creation Index ⓘ | 0.2 | 0.4 | 0.4 | 0.2 | 0.7 | 0.4 | 0.2 | -0.1 | -0.6 | 1.3 | - |
Growth Parameters ⓘGrowth Parameters Colour Code Guide ⓘ | |||||||||||
| Sales ⓘ | 1,218 | 1,409 | 1,282 | 1,329 | 1,593 | 1,708 | 1,864 | 2,201 | 2,302 | 2,539 | 2,740 |
| Sales YoY Gr. | - | 15.7% | -9.1% | 3.7% | 19.8% | 7.2% | 9.1% | 18.1% | 4.6% | 10.3% | - |
| Adj EPS ⓘ | 6.7 | 9.9 | 12.4 | 11.1 | 12 | 19.3 | 19.6 | 18.8 | 8.2 | 20 | 15 |
| YoY Gr. | - | 47.2% | 25.2% | -10.9% | 8% | 61.5% | 1.2% | -3.6% | -56.3% | 142.1% | - |
| BVPS (₹) ⓘ | 37.9 | 45.4 | 55.1 | 63.6 | 82 | 86.8 | 107.2 | 120 | 119.2 | 165.3 | 280.9 |
| Adj Net Profit ⓘ | 46.7 | 68.7 | 86 | 76.6 | 82.8 | 134 | 135 | 130 | 57 | 138 | 118 |
| Cash Flow from Ops. ⓘ | 112 | 164 | 163 | 148 | 71 | 263 | 165 | 180 | 287 | 193 | - |
| Debt/CF from Ops. ⓘ | 3.9 | 2.6 | 2.7 | 2.9 | 5.2 | 1.9 | 3.7 | 4.6 | 2.9 | 2.3 | - |
CAGR Colour Code Guide ⓘ
| 9 Years | 5 Years | 3 Years | 1 Years | |||||
|---|---|---|---|---|---|---|---|---|
| Sales ⓘ | 8.5% | 9.8% | 10.9% | 10.3% | ||||
| Adj EPS ⓘ | 12.8% | 10.8% | 0.7% | 142.1% | ||||
| BVPSⓘ | 17.8% | 15.1% | 15.5% | 38.7% | ||||
| Share Price | 27.5% | 23.1% | 23.6% | 55.2% | ||||
Performance Ratio Colour Code Guide ⓘ
| Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 | TTM | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Return on Equity % ⓘ | 17.5 | 23.8 | 24.7 | 18.7 | 16.4 | 22.9 | 20.1 | 16.6 | 6.9 | 14 | 6.7 |
| Op. Profit Mgn % ⓘ | 10.7 | 12 | 14.8 | 14.3 | 13 | 14.6 | 15 | 12.7 | 10 | 12.9 | 13.9 |
| Net Profit Mgn % ⓘ | 3.8 | 4.9 | 6.7 | 5.8 | 5.2 | 7.8 | 7.3 | 5.9 | 2.5 | 5.4 | 4.3 |
| Debt to Equity ⓘ | 1.7 | 1.4 | 1.1 | 1 | 0.7 | 0.8 | 0.8 | 1 | 1 | 0.4 | - |
| Working Cap Days ⓘ | 202 | 193 | 228 | 231 | 213 | 239 | 256 | 247 | 243 | 217 | 83 |
| Cash Conv. Cycle ⓘ | 108 | 90 | 81 | 78 | 78 | 76 | 68 | 75 | 70 | 59 | 18 |
Sales growth is growing at healthy rate in last 3 years 10.85%
Debt to equity has declined versus last 3 years average to 0.39
Sales growth is good in last 4 quarters at 12.09%
Return on Equity has declined versus last 3 years average to 6.70%
Net Profit has been subdued in last 3 years 0.68%
| Standalone | Consolidated | |
|---|---|---|
| TTM EPS (₹) | 19.8 | 15 |
| TTM Sales (₹ Cr.) | 2,428 | 2,740 |
| BVPS (₹.) ⓘ | 282.7 | 280.9 |
| Reserves (₹ Cr.) ⓘ | 2,205 | 2,192 |
| P/BV ⓘ | 3.51 | 3.53 |
| PE ⓘ | 50.12 | 66.08 |
| From the Market | |
|---|---|
| 52 Week Low / High (₹) | 609.40 / 1235.00 |
| All Time Low / High (₹) | 3.55 / 1235.00 |
| Market Cap (₹ Cr.) | 7,791 |
| Equity (₹ Cr.) | 15.7 |
| Face Value (₹) | 2 |
| Industry PE ⓘ | 37.9 |
| Mar'24 | YoY Gr. Rt. % | Jun'24 | YoY Gr. Rt. % | Sep'24 | YoY Gr. Rt. % | Dec'24 | YoY Gr. Rt. % | |
|---|---|---|---|---|---|---|---|---|
| Sales (₹ Cr.)ⓘ | 758 | 10.7 | 627 | 4.1 | 689 | 15.8 | 666 | 17.8 |
| Adj EPS (₹) ⓘ | 8.4 | 78.3 | 4.3 | -36.6 | 6.1 | 103.3 | 3.4 | 45 |
| Op. Profit Mgn % ⓘ | 15.71 | 335 bps | 12.86 | 126 bps | 14.67 | 293 bps | 12.09 | 80 bps |
| Net Profit Mgn % ⓘ | 7.59 | 288 bps | 4.65 | -298 bps | 6.08 | 261 bps | 3.48 | 65 bps |
| Pledged * | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Stock pulse is a format where we explore the most important questions to understand the company's performance.
What are the recent developments?
Sudarshan Chemicals is the largest pigment producer in India (3rd globally) catering to coatings (example- for auto manufacturers), plastics, inks, and cosmetics segments. The company produces specialty pigments (69% of revenues; higher margins) and non-speciality pigments. Revenue is spread across domestic (55% share in FY23) and export markets (45% share in FY23). Major export markets for it are US and Europe followed by China.
How has been the revenue trajectory?
Consolidated revenues (including non-core businesses) have grown 8% CAGR over FY19-23, while the pigment business has grown 11% CAGR over the same period. In H1FY24 revenue has grown to Rs. 1209 Crs (up 12% YoY) driven by volumes.
What is the margin outlook?
In FY23, the margin was impacted by high input costs and high energy and logistics costs. In H1FY24, raw material pressure has eased, leading to margin recovery (11% vs 9% in FY23). Margins are expected to be stable going ahead with operating leverage benefits kicking in as revenues ramp up. Management has guided that new capacity expansion will be towards specialty pigments aiding margins.
What will be the drivers in the future?
The company has expanded capacities over the last few years (~Rs 7.5 bn Capex) and is expected to generate Rs 12 bn+ revenues over the next 3-5 years. Domestic capacities shutting coupled with broadening of product portfolio (~70%+ of top 2 players), will be a positive. However, the near-term outlook remains subdued due to adverse macros- inflation worries in global markets, evolving geo-political uncertainties, and the destocking effect.
Sudarshan Chemicals has some positives such as (a) niche global pigment player with a wide customer base and high stickiness (long product approval cycles), (b) ramping up its product basket, (c) focus on optimizing working capital and driving efficiencies.
Particulars | Q2FY24 (Rs. Crs) | YoY Trend | Comments |
| Revenue | 601 | +14% | Core pigment segment grew 2% and other segments grew 1.5x |
| EBITDA | 66 | +53% | |
| EBITDA Margin | 11% | +283bps | Normalized material costs contributed to margins |
| PAT | 18 | +260% | Other income and lower tax supported margins |
Strong results on input cost reducing and operating leverage playing out.
|
Particulars |
Q1FY24 |
YoY Trend |
Comments |
|
Revenue |
608 |
+10% |
Export revenue grew 5% while domestic revenue remained flat |
|
EBITDA |
70 |
+70% |
|
|
EBITDA Margin |
11% |
+411 bps |
Change in business mix (increase of speciality chemicals-better margins) aided EBITDA margin expansion |
|
PAT |
267 |
+3714% |
Normalized PAT stood at ~Rs 26 Cr as one off other income gain on sale of land in Pune (Maharashtra) |
Good performance in export and speciality segments.
Market Cap = INR 2,657 cr
CMP = INR 384
P/E = 28.6 X TTM
|
Results |
INR Crore |
YoY Growth |
Comments |
|
Revenue |
528 |
6.02% |
Paint demand muted due to prolonged rainfall |
|
EBITDA |
43 |
-18.9% |
Elevated energy and raw material costs put the margin down |
Key Highlights:-
In paint business, revenue from operations increased but that was due to price correction rather than volume growth.
Buying decisions deferment in both plastic and paints by customers due to volatility in prices.
Energy costs at elevated level.
Global geopolitical scenarios and monetary tightening led to subdues demand across various product categories.
Overall CAPEX plan of INR 750 cr, out of which INR 150 cr is CWIP.
Several competitors exited the market and energy costs remain elevated in Europe, which can provide some tailwinds.
Provisional anti duty dumping imposed in China on Indian thylocyanide, which will decrease their competitiveness in Chinese markets.
Management Outlook:-
Demand expected to remain muted in the upcoming quarters as well.
Volume degrowth in international market a big concern, which is expected to reverse in the upcoming quarters.
It will take 3-4 years for the new CAPEX to get fully utilized.
| Company Name | CMP(₹) | |||||||
|---|---|---|---|---|---|---|---|---|
| Sudarshan Chemicals | 1,011.4 | 19.9 (2%) | Small Cap | 2,539 | 15 | 5.4 | 66.1 | 3.5 |
| Bodal Chemicals | 61.6 | 3.1 (5.3%) | Small Cap | 1,386 | 1.1 | 0.1 | 53 | 0.7 |
| Shree Pushkar Chem | 266.2 | -0.4 (-0.1%) | Small Cap | 726 | 17.1 | 5.1 | 15.6 | 1.7 |
| Kiri Industries | 613.2 | -11.6 (-1.9%) | Small Cap | 633 | -4.8 | -14.6 | - | 6.4 |
| Bhageria Industries | 152.5 | 7.1 (4.9%) | Small Cap | 495 | 7.6 | 3.6 | 19.3 | 1.2 |
| Poddar Pigments | 307.3 | 26.4 (9.4%) | Small Cap | 369 | 24.9 | 7.4 | 11.3 | 0.8 |
| Vidhi Specialty Food | 464.1 | 9.1 (2%) | Small Cap | 303 | 8.4 | 12.1 | 53.9 | 7.5 |
| Aksharchem (I) | 216.4 | 2.5 (1.2%) | Small Cap | 302 | -3.3 | -6.2 | - | 0.7 |
| Dynemic Products | 277.9 | 15 (5.7%) | Small Cap | 284 | 12.6 | 1.4 | 20.8 | 1.5 |
| Asahi Songwon Colors | 332.4 | 0.4 (0.1%) | Small Cap | 277 | 17.2 | 2.6 | 19.4 | 1.4 |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 1,218 | 1,409 | 1,282 | 1,329 | 1,593 | 1,708 | 1,864 | 2,201 | 2,302 | 2,539 |
| Operating Expenses ⓘ | 1,088 | 1,240 | 1,095 | 1,142 | 1,387 | 1,460 | 1,584 | 1,923 | 2,089 | 2,222 |
| Manufacturing Costs | 155 | 181 | 176 | 183 | 185 | 189 | 220 | 298 | 322 | 340 |
| Material Costs | 731 | 820 | 708 | 757 | 942 | 976 | 1,060 | 1,270 | 1,368 | 1,415 |
| Employee Cost | 89 | 99 | 92 | 94 | 124 | 146 | 156 | 184 | 184 | 210 |
| Other Costs ⓘ | 112 | 140 | 118 | 109 | 135 | 149 | 148 | 171 | 214 | 256 |
| Operating Profit ⓘ | 130 | 170 | 187 | 187 | 206 | 248 | 280 | 278 | 213 | 317 |
| Operating Profit Margin (%) | 10.7% | 12.0% | 14.6% | 14.1% | 13.0% | 14.5% | 15.0% | 12.6% | 9.3% | 12.5% |
| Other Income ⓘ | 24 | 14 | 18 | 11 | 7 | 5 | 17 | 5 | 5 | 19 |
| Interest ⓘ | 41 | 37 | 30 | 25 | 19 | 16 | 20 | 23 | 44 | 39 |
| Depreciation ⓘ | 42 | 48 | 49 | 58 | 66 | 74 | 87 | 89 | 114 | 141 |
| Exceptional Items ⓘ | 0 | 0 | 0 | 0 | 72 | 17 | 0 | 0 | 0 | 315 |
| Profit Before Tax ⓘ | 72 | 99 | 126 | 115 | 201 | 180 | 190 | 171 | 60 | 471 |
| Tax ⓘ | 17 | 29 | 34 | 38 | 68 | 35 | 49 | 41 | 15 | 113 |
| Profit After Tax | 54 | 70 | 92 | 77 | 133 | 145 | 141 | 130 | 45 | 357 |
| PAT Margin (%) | 4.5% | 5.0% | 7.2% | 5.8% | 8.3% | 8.5% | 7.6% | 5.9% | 1.9% | 14.1% |
| Adjusted EPS (₹) | 7.9 | 10.1 | 14.6 | 12.2 | 19.5 | 20.9 | 20.4 | 18.8 | 6.5 | 51.6 |
| Dividend Payout Ratio (%) | 22% | 30% | 24% | 29% | 31% | 30% | 29% | 27% | 23% | 9% |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
Equity and Liabilities | ||||||||||
| Shareholders Fund | 263 | 314 | 381 | 440 | 568 | 601 | 742 | 831 | 825 | 1,144 |
| Share Capital ⓘ | 14 | 14 | 14 | 14 | 14 | 14 | 14 | 14 | 14 | 14 |
| Reserves ⓘ | 249 | 300 | 367 | 426 | 554 | 587 | 728 | 817 | 811 | 1,131 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Debt | 383 | 393 | 341 | 361 | 303 | 451 | 487 | 672 | 642 | 280 |
| Long Term Debt | 161 | 218 | 142 | 182 | 113 | 225 | 308 | 369 | 449 | 193 |
| Short Term Debt | 222 | 174 | 199 | 179 | 190 | 226 | 179 | 303 | 192 | 86 |
| Trade Payables | 188 | 216 | 270 | 264 | 242 | 371 | 441 | 522 | 509 | 512 |
| Others Liabilities ⓘ | 300 | 311 | 370 | 334 | 504 | 477 | 654 | 696 | 759 | 756 |
| Total Liabilities ⓘ | 1,134 | 1,233 | 1,362 | 1,400 | 1,617 | 1,901 | 2,325 | 2,720 | 2,734 | 2,692 |
Fixed Assets | ||||||||||
| Gross Block | 645 | 715 | 503 | 584 | 637 | 872 | 945 | 1,248 | 1,650 | 1,763 |
| Accumulated Depreciation | 312 | 357 | 52 | 108 | 172 | 245 | 330 | 416 | 524 | 662 |
| Net Fixed Assetsⓘ | 333 | 358 | 452 | 475 | 465 | 627 | 615 | 832 | 1,126 | 1,102 |
| CWIP ⓘ | 8 | 15 | 8 | 6 | 24 | 48 | 278 | 285 | 44 | 15 |
| Investmentsⓘ | 0 | 0 | 0 | 0 | 0 | 1 | 1 | 2 | 2 | 2 |
| Inventories | 250 | 253 | 261 | 273 | 308 | 411 | 412 | 566 | 494 | 438 |
| Trade Receivables | 317 | 353 | 343 | 333 | 346 | 364 | 485 | 501 | 486 | 585 |
| Cash Equivalents | 23 | 25 | 15 | 14 | 8 | 16 | 24 | 35 | 29 | 56 |
| Others Assetsⓘ | 202 | 228 | 283 | 298 | 466 | 435 | 510 | 500 | 552 | 495 |
| Total Assets ⓘ | 1,134 | 1,233 | 1,362 | 1,400 | 1,617 | 1,901 | 2,325 | 2,720 | 2,734 | 2,692 |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash Flow From Operating Activity ⓘ | 112 | 164 | 163 | 148 | 71 | 263 | 165 | 180 | 287 | 193 |
| PBT ⓘ | 72 | 99 | 126 | 115 | 128 | 163 | 190 | 171 | 60 | 155 |
| Adjustment ⓘ | 81 | 91 | 76 | 93 | 68 | 111 | 104 | 104 | 158 | 168 |
| Changes in Working Capital ⓘ | -26 | -6 | -15 | -72 | -103 | 50 | -91 | -58 | 80 | -46 |
| Tax Paid ⓘ | -14 | -20 | -32 | -28 | -32 | -62 | -39 | -38 | -11 | -84 |
| Cash Flow From Investing Activity ⓘ | -61 | -83 | -135 | -87 | -27 | -220 | -266 | -308 | -189 | 279 |
| Capex | -56 | -85 | -134 | -87 | -102 | -254 | -268 | -309 | -191 | 267 |
| Net Investments | 0 | -2 | 0 | 0 | 1 | -1 | 0 | 0 | 0 | 8 |
| Others ⓘ | -5 | 4 | -1 | 0 | 75 | 35 | 2 | 1 | 1 | 4 |
| Cash Flow From Financing Activityⓘ | -43 | -81 | -38 | -62 | -48 | -39 | 108 | 138 | -103 | -446 |
| Net Proceeds from Shares ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Net Proceeds from Borrowing ⓘ | -28 | 36 | -8 | 7 | -63 | 64 | 174 | 55 | 78 | -267 |
| Interest Paid ⓘ | -38 | -33 | -27 | -24 | -18 | -14 | -17 | -19 | -35 | -35 |
| Dividend Paid ⓘ | -12 | -35 | -25 | -29 | -8 | -100 | 0 | -41 | -34 | -33 |
| Others ⓘ | 36 | -48 | 22 | -16 | 41 | 11 | -48 | 143 | -112 | -111 |
| Net Cash Flow ⓘ | 8 | 0 | -10 | -2 | -3 | 3 | 8 | 9 | -5 | 27 |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Ratios | ||||||||||
| ROE (%) | 22.48 | 24.25 | 26.41 | 18.74 | 26.35 | 24.83 | 21.01 | 16.52 | 5.41 | 36.3 |
| ROCE (%) | 16.54 | 18.84 | 19.99 | 16.61 | 24.38 | 19.35 | 17.13 | 12.87 | 6.29 | 31.49 |
| Asset Turnover Ratio | 1.21 | 1.28 | 1.06 | 0.98 | 1.06 | 0.97 | 0.88 | 0.87 | 0.84 | 0.94 |
| PAT to CFO Conversion(x) | 2.07 | 2.34 | 1.77 | 1.92 | 0.53 | 1.81 | 1.17 | 1.38 | 6.38 | 0.54 |
| Working Capital Days | ||||||||||
| Receivable Days | 80 | 81 | 92 | 91 | 78 | 76 | 83 | 82 | 78 | 77 |
| Inventory Days | 71 | 61 | 68 | 72 | 67 | 77 | 81 | 81 | 84 | 67 |
| Payable Days | 61 | 76 | 117 | 129 | 98 | 115 | 140 | 138 | 137 | 132 |
Sudarshan Chemical Industries company was incorporated on February 19, 1951 at Pune as a private limited company and converted into a public limited company on December 31, 1974. Sudarshan Chemical Industries is owned by the Rathi group of companies and accounts for 70% of the Rathi group sales revenue each year. The company makes all its products in-house on its own production plants in Roha and Mahad, in the Maharastra state of India.Its extensive range of products includes organic and inorganic pigments, mica-based effect pigments, chemical intermediates and pesticides. They have a continuous R&D programme, with technologists working on new and customised solutions.
It was the first chemical company in India to be awarded the ISO 9001 certificate in 1993 and continuously evolve and improve itself throughout to maintain high quality standards at every level of the company. It is also accredited with ISO 14001, ISO 18000 and ISO 17025 international quality standards. In order to improve the customer service, they have implemented many planning tools like SAP and CRM that connect factories, branch offices and depots. Supply chain solutions are currently being implemented to further increase the value of their goods.
Business area of the company
Sudarshan manufactures an extensive range of Organic, Inorganic and Pearlescent pigments and dispersions catering to the Coatings, Plastics, Inks and Cosmetics Industries worldwide. Sudarshan also manufactures agrochemicals.
Products
Sudarshan’s product portfolio includes recognized brands like Sudaperm, Sudafast, Sudacolor, Sumica and Sumicos.
Color product
Effect product
Awards & Accolades
2017-18
2018-19
2019-20
Milestones
MoneyWorks4Me rating and ranking of funds for SIP is available to subscribers only. Moneyworks4Me is not a rating and ranking agency, however it is required that users have a way of selecting funds and building a Portfolio. The method used by it are described below to enable users to understand the logic behind the rating and ranking Subscriber will find more details on this in the various content made available from time to time. In case you need more please write to besafe@moneyworks4Me.com
MoneyWorks4Me rates and ranks mutual funds based on the following data-driven system:
Funds ranking in screeners: Performance Consistency and Quality are two parameters used for ranking funds for SIP. The ranking as follows GG, GO, GR, OG, OO, OR, RG, RO and RR.
With the same color-coded funds, the one with the higher Average 3-year rolling returns (over 5 to 10 years), the number that appears in the Performance tag, ranks higher.
Here is the summary:
The third tag Upside Potential is not relevant for SIP. It is relevant for lumpsum investments in Mutual Funds.
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