Chemplast Sanmar Limited

Basic Materials — Chemicals · NSE

₹213.00+₹9.35 (+4.59%)

DalalBaazaar Score

24 / 100

🔴 Weak

Verdict

HIGH RISK

Risk

Very High

Driven by moderate debt load, short-term liabilities exceed short-term assets, negative free cash flow.

In simple words: The company is currently losing money, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Chemplast Sanmar Limited engages in manufacturing and selling of specialty chemicals in India.

IndustryChemicals

SectorBasic Materials

Employees1,399

Annual revenue₹4,216 Cr

How does it make money?

Turns over ₹4,216 Cr a year. Of every ₹100 of sales, about ₹-7 reaches shareholders as profit, with ₹3 left at the operating level before interest, tax and depreciation. Each of its 1,399 employees supports ₹3.01 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin3.0%

Net margin-6.6%

Revenue / employee₹3.01 Cr

Who are its competitors?

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

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 -7.1% 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.

ROCE-7.1%

ROE-16.0%

Peer median ROE15.4%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 12.0% and earnings to grow about 114.7% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+12.0%

Est. earnings growth+114.7%

Analysts3

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -15% while net margin moved -315% 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-15%

Margin effect-315%

DalalBaazaar Score

24/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 5.1% a year
✗ Profit fell 153.6% in the latest year

Quality vs. Valuation

Company Quality

20/ 100

Weak

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

Valuation

25/ 100

Expensive

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

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

P/E (Trailing)

Not meaningful

P/B

1.92x

EV/EBITDA

39.3x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well0

Nothing stands out as clearly improving on the years of data available.

🔴 What Needs Attention6

Margins are compressing
EBITDA margin has slipped from 9.4% to 3.0% over 3 years.
Debt is rising
Total debt is up 92% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 8.2% to -16.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 6.8% to -7.1% — often a sign of competition or overexpansion.
Short-term liquidity is tight
Current ratio of 0.50 — near-term obligations exceed near-term assets.

Red Flags

7 items require attention · 5 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 92% over 3 years, from ₹1,019 Cr to ₹1,952 Cr.
🔴Thin interest coverageFinancial
Operating profit covers interest only -1.8x — little room if earnings dip.
🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴The company is lossmakingFinancial
Net profit of -₹280 Cr in the latest reported year.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 6.5 points, from 9.4% to 3.0%.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from -0.3x to -1.8x.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.50 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

No clear supporting case emerges from the available numbers.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 9.4% to 3.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 15.7x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 8.2% to -16.0%. 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.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
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 1%✓ 3.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 15.7x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹22 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ -1.8x
How much operating profit can fall before interest stops being comfortably covered.
5ROCE stays above 8%✗ -7.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 12 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
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

0 good · 5 neutral · 6 weak

Market Cap

₹3,368 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

1.92x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹-24.63

Loss-making

Negative earnings per share — the business is losing money

ROE

-16.0%

Weak

Weak capital efficiency

ROCE

-7.1%

Weak

Low return on total capital employed

Debt/Equity

1.11x

Moderate

Moderate leverage

Revenue Growth (YoY)

2.3%

Modest

Modest growth

Profit Growth (YoY)

-153.6%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹22 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹213

P/E (Forward)

72.6x

Operating Margin

-15.6%

Weak

Thin margins leave little room for error

Net Margin

-9.2%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.50

Tight

Tight short-term liquidity

Beta (vs Nifty)

-0.11

Defensive

Steadier than the market

52W Range Position

21%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

200.4 / 186.3

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

57.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,935 Cr	₹3,916 Cr	₹4,328 Cr	₹4,216 Cr	-5.1%
EBITDA	₹466 Cr	-₹6 Cr	₹155 Cr	₹124 Cr	-35.6%
EBITDA Margin	9.4%	-0.1%	3.6%	3.0%	—
PAT (Net Profit)	₹152 Cr	-₹158 Cr	-₹110 Cr	-₹280 Cr	—
EPS	₹9.64	₹-10.02	₹-6.92	₹-17.7	—
ROE	8.2%	-9.3%	-5.3%	-16.0%	—
ROCE	6.8%	-3.9%	-1.1%	-7.1%	—
Total Debt	₹1,019 Cr	₹1,548 Cr	₹1,842 Cr	₹1,952 Cr	+24.2%
Free Cash Flow	-₹64 Cr	-₹864 Cr	-₹211 Cr	-₹22 Cr	—

🔴 Revenue has shrunk at 5.1% a year over 3 years.

🔴 EBITDA has shrunk at 35.6% a year over 3 years.

🔴 EBITDA Margin has fallen from 9.4% to 3.0% over 3 years (-6.5 pts).

🔴 PAT (Net Profit) has turned negative, from ₹152 Cr to -₹280 Cr.

🔴 EPS has turned negative, from ₹9.64 to ₹-17.7.

🔴 ROE has fallen from 8.2% to -16.0% over 3 years (-24.1 pts).

🔴 ROCE has fallen from 6.8% to -7.1% over 3 years (-13.8 pts).

🔴 Total Debt has grown at 24.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹6,315 Cr

Total Liabilities

₹4,561 Cr

Total Debt

₹1,952 Cr

Cash & Equivalents

₹430 Cr

Operating Cash Flow

₹294 Cr

Capex

-₹316 Cr

Shareholding (proxy)

Institutional Holding

33.3%

Insider Holding

55.0%

Analyst Consensus

Recommendations

4 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹277.25

+30.2% vs CMP

Target Range

₹224 – ₹320

Peer Comparison

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

Recent News

3 mixed3 general

Chemplast Sanmar (CHEMPLASTS) Share/Stock Price Live, NSE

TechGraph, 09 Oct

Chemplast Sanmar Limited (NSE:CHEMPLASTS) Just Reported, And Analysts Assigned A ₹298 Price Target

Simply Wall Street, 09 AugAnalyst view

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

Buzzing Stocks: Tejas Networks advances 10% on TCS LoI; Chemplast Sanmar gains 3% on MD appointment

Moneycontrol.com, 28 Aug

Chemplast Sanmar Share Price Outlook: What Could Drive the Next Major Move?

Kalkine India, 08 Sept

Chemplast Sanmar to acquire 27% stake in Yesaryes Energy for ₹45 lakh

scanx.trade, 10 OctM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Chemplast Sanmar Reports ₹45.4 Crore Q4 Loss; Revenue Increases 9% to ₹1,255 Crore

Sahi, 25 MayResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

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

DalalBaazaar Thesis

🔴Business QualityWeak4.7/20

🔴Financial HealthStretched5.5/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak2.5/15

🔴ValuationDemanding5.1/15

🔴RiskHigh4/10

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 5 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 1%3.0%
✗Debt / EBITDA falls below 3x15.7x
✗Free cash flow remains positive-₹22 Cr
✗Interest cover stays above 3x-1.8x
✗ROCE stays above 8%-7.1%