Chemcon Speciality Chemicals Limited

Basic Materials — Specialty Chemicals · NSE

₹218.52−₹2.14 (−0.97%)

DalalBaazaar Score

50 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Low

Driven by micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

The 60-second version of Chemcon Speciality Chemicals Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Chemcon Speciality Chemicals Limited engages in the manufacture and sale of specialty chemicals for pharmaceutical, agro-chemical, textile, personal care, construction, automotive, electronics, aromatic chemicals, fine chemical, silanes, and oilfield chemicals industries in India and internationally.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees238

Annual revenue₹239 Cr

How does it make money?

Turns over ₹239 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹19 left at the operating level before interest, tax and depreciation. Each of its 238 employees supports ₹1.00 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin18.9%

Net margin9.9%

Revenue / employee₹1.00 Cr

Who are its competitors?

The closest listed comparisons in its industry are ASIAN PAINTS LIMITED, PIDILITE INDUSTRIES LTD, SRF LTD, UPL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

ASIAN PAINTS LIMITEDP/E 46.9x · ROE 22.3%

PIDILITE INDUSTRIES LTDP/E 57.8x · ROE 24.4%

SRF LTDP/E 33.8x · ROE 15.4%

UPL LIMITEDP/E 21.5x · ROE 6.1%

What is its competitive advantage?Little sign of one

Returns on capital of 6.9% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

ROCE6.9%

ROE4.9%

Peer median ROE22.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -21% while net margin moved -46% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect-21%

Margin effect-46%

DalalBaazaar Score

50/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 7.4% a year
✗ Profit has declined at 24.6% a year

Quality vs. Valuation

Company Quality

48/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

64/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

28.2x

3Y Median

31.2x

40 monthly readings · mean 30.0x · range 15.4x–51.7x

Sector Median

40.4x

median of 4 sector peers

🟡Currently trading close to its 3y median of 31.2x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 30% below the peer median of 40.4x.

vs. its own history

Fair

31.2x median over 40 months · -10%

vs. sector peers

Cheap

40.4x median of 4 peers · -30%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

28.2x

P/B

1.66x

EV/EBITDA

18.6x

PEG

—

Dividend Yield

5.95%

What's Good / What's Bad

🟢 What's Going Well4

Debt is being paid down
Total debt is down 16% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Very low debt
Debt/Equity of 0.11x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Margins are compressing
EBITDA margin has slipped from 27.7% to 18.9% over 3 years.
Return on equity is falling
ROE has dropped from 12.0% to 4.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 16.4% to 6.9% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Significant margin compressionFinancial
EBITDA margin has fallen 8.7 points, from 27.7% to 18.9%.
🟡Profit is decliningFinancial
Net profit is down 57% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 16% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 30% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹32 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 27.7% to 18.9%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Returns on shareholder capital are falling
ROE has dropped from 12.0% to 4.9%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 17%✓ 18.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹32 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 1.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 8%✗ 6.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 31.2x✓ 28.2x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

9 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

6 good · 3 neutral · 2 weak

Market Cap

₹800 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

28.2x

Fair

Fairly valued against the generic band

P/B Ratio

1.66x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹7.75

Profitable

Profitable on a per-share basis

ROE

4.9%

Weak

Weak capital efficiency

ROCE

6.9%

Weak

Low return on total capital employed

Debt/Equity

0.11x

Low

Conservative leverage

Revenue Growth (YoY)

24.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

71.8%

Healthy

Profits growing at a healthy clip

Dividend Yield

5.95%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹32 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹218.52

Operating Margin

17.6%

Good

Healthy core-business profitability

Net Margin

11.1%

Good

Strong bottom-line conversion

Current Ratio

4.41

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.35

Defensive

Steadier than the market

52W Range Position

67%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

220.6 / 207.6

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

42.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹301 Cr	₹265 Cr	₹206 Cr	₹239 Cr	-7.4%
EBITDA	₹83 Cr	₹40 Cr	₹47 Cr	₹45 Cr	-18.4%
EBITDA Margin	27.7%	15.1%	22.9%	18.9%	—
PAT (Net Profit)	₹55 Cr	₹19 Cr	₹24 Cr	₹24 Cr	-24.6%
EPS	₹15.04	₹5.24	₹6.68	₹6.44	-24.6%
ROE	12.0%	4.0%	4.9%	4.9%	—
ROCE	16.4%	6.2%	7.2%	6.9%	—
Total Debt	₹64 Cr	₹43 Cr	₹25 Cr	₹54 Cr	-5.8%
Free Cash Flow	-₹33 Cr	-₹31 Cr	₹29 Cr	₹32 Cr	—

🔴 Revenue has shrunk at 7.4% a year over 3 years.

🔴 EBITDA has shrunk at 18.4% a year over 3 years.

🔴 EBITDA Margin has fallen from 27.7% to 18.9% over 3 years (-8.7 pts).

🔴 PAT (Net Profit) has shrunk at 24.6% a year over 3 years.

🔴 EPS has shrunk at 24.6% a year over 3 years.

🔴 ROE has fallen from 12.0% to 4.9% over 3 years (-7.2 pts).

🔴 ROCE has fallen from 16.4% to 6.9% over 3 years (-9.4 pts).

🟢 Total Debt has shrunk at 5.8% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹33 Cr to ₹32 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹568 Cr

Total Liabilities

₹85 Cr

Total Debt

₹54 Cr

Cash & Equivalents

₹10 Cr

Operating Cash Flow

₹42 Cr

Capex

-₹9 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

74.5%

Corporate Actions

Dividend Rate

₹13

Ex-Dividend Date

27 May 2026

Peer Comparison

Company	P/E	ROE
ASIAN PAINTS LIMITED	46.9x	22.3%
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

1 positive3 mixed2 general

Chemcon Speciality Chemicals IPO Opens For Bidding. Key Things To Know

NDTV Profit, 17 Oct

Why Is Chemcon Speciality Chemicals Share Price Falling Key Reasons 2026

Univest, 03 JunPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Chemcon Speciality Chemicals Ltd is Rated Sell

MarketsMojo, 13 Oct

Chemcon Speciality Chemicals cancels analyst meeting scheduled for Sep 23

scanx.trade, 23 SeptAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Chemcon Speciality Chemicals standalone net profit rises 71.52% in the June 2026 quarter

Business Standard, 04 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Chemcon Speciality Chemicals Schedules Analyst And Investor Meeting For September 23

Sahi, 18 SeptAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟡Business QualityAdequate9/20

🟢Financial HealthStrong17.6/20

🔴GrowthWeak2.4/20

🟡ProfitabilityModerate6.9/15

🟡ValuationFair9/15

🟡RiskModerate5.2/10

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 17%18.9%
✓Free cash flow remains positive₹32 Cr
✓Debt / EBITDA stays below 2x1.2x
✗ROCE stays above 8%6.9%
✓Valuation vs its own median of 31.2x28.2x today