PCBL Chemical Limited

Basic Materials — Specialty Chemicals · NSE

₹310.00+₹1.10 (+0.36%)

DalalBaazaar Score

39 / 100

🔴 Weak

Verdict

CAUTION

Risk

Moderate

Driven by moderate debt load, short-term liabilities exceed short-term assets, small-cap size, which brings sharper price swings.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Short-term liquidity is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:27 pm

Understanding the Business

Company site ↗

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

What does this company do?

PCBL Chemical Limited, together with subsidiaries, produces, sells, and exports carbon black in India and internationally. The company operates through Carbon Black, Power, Chemicals, and Battery Chemical segments.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees1,350

Annual revenue₹8,126 Cr

How does it make money?

Turns over ₹8,126 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 1,350 employees supports ₹6.02 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹6.02 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.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 8.7% 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.

Peer median ROE22.3%

What is the outlook?

9 analysts covering the stock expect revenue to grow about 11.3% and earnings to grow about 31.7% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+11.3%

Est. earnings growth+31.7%

Analysts9

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +41% while net margin moved -68% 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+41%

Margin effect-68%

DalalBaazaar Score

39/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ ROE of 4.9% is weak
✗ ROE has fallen by 10.7 points over the period

Quality vs. Valuation

Company Quality

37/ 100

Weak

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

Valuation

39/ 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.

Historical Valuation

Current P/E

46.8x

3Y Median

27.8x

40 monthly readings · mean 30.6x · range 14.4x–64.5x

Sector Median

40.4x

median of 4 sector peers

⚠️Current valuation is approximately 68% above its 3y median of 27.8x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 16% above the peer median of 40.4x.

vs. its own history

Expensive

27.8x median over 40 months · +68%

vs. sector peers

Fair

40.4x median of 4 peers · +16%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

16.0x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 15.6% to 4.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 17.7% to 8.7% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 2 high · 3 watch

🔴Debt has risen sharplyFinancial
Total debt is up 385% over 3 years, from ₹1,029 Cr to ₹4,989 Cr.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.6x — little room if earnings dip.
🟡Profit is decliningFinancial
Net profit is down 55% over 3 years.
🟡Inventory building faster than salesFinancial
Inventory up 79% against revenue up 41% — stock may not be moving.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.83 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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?

The debt load needs earnings to hold up
Debt is 4.7x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 68% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 15.6% 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
Small 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.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

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

1Revenue growth stays above 9% a year✓ 12.2% CAGR
Latest reported year was 17.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 13.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 4.7x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Interest cover stays above 3x✗ 1.6x
How much operating profit can fall before interest stops being comfortably covered.
5Free cash flow remains positive✓ ₹850 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 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

4 good · 5 neutral · 2 weak

Market Cap

₹12,197 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

46.8x

Expensive

Expensive — verify against sector peers

P/B Ratio

3.04x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹6.63

Profitable

Profitable on a per-share basis

ROE

4.9%

Weak

Weak capital efficiency

ROCE

8.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

1.24x

Moderate

Moderate leverage

Revenue Growth (YoY)

17.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

58.9%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.45%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹850 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

20.3x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

11.8%

Average

Average margins

Net Margin

3.0%

Average

Average bottom-line conversion

Current Ratio

0.83

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.61

Defensive

Steadier than the market

52W Range Position

56%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

326.7 / 323.5

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

21.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹5,752 Cr	₹6,387 Cr	₹8,356 Cr	₹8,126 Cr	+12.2%
EBITDA	₹752 Cr	₹1,056 Cr	₹802 Cr	₹1,062 Cr	+12.2%
EBITDA Margin	13.1%	16.5%	9.6%	13.1%	—
PAT (Net Profit)	₹442 Cr	₹491 Cr	₹435 Cr	₹198 Cr	-23.5%
EPS	₹11.7	₹13	₹11.48	₹5.13	-24.0%
ROE	15.6%	15.1%	11.8%	4.9%	—
ROCE	17.7%	10.6%	13.2%	8.7%	—
Total Debt	₹1,029 Cr	₹4,983 Cr	₹5,571 Cr	₹4,989 Cr	+69.2%
Free Cash Flow	-₹392 Cr	₹570 Cr	-₹13 Cr	₹850 Cr	—

🟢 Revenue has grown at 12.2% a year over 3 years.

🟢 EBITDA has grown at 12.2% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 13.1% over 3 years.

🔴 PAT (Net Profit) has shrunk at 23.5% a year over 3 years.

🔴 EPS has shrunk at 24.0% a year over 3 years.

🔴 ROE has fallen from 15.6% to 4.9% over 3 years (-10.7 pts).

🔴 ROCE has fallen from 17.7% to 8.7% over 3 years (-9.0 pts).

🔴 Total Debt has grown at 69.2% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹392 Cr to ₹850 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹11,295 Cr

Total Liabilities

₹7,275 Cr

Cash & Equivalents

₹230 Cr

Operating Cash Flow

₹1,576 Cr

Capex

-₹727 Cr

Shareholding (proxy)

Institutional Holding

64.5%

Insider Holding

7.1%

Corporate Actions

Dividend Rate

₹4.5

Ex-Dividend Date

04 Aug 2026

Analyst Consensus

Recommendations

4 Buy · 4 Hold · 3 Sell

Target Price (Mean)

₹361.73

+16.7% vs CMP

Target Range

₹279 – ₹480

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

PCBL Chemical Dividend 2026: ₹4.50, Record Date 4 Aug & History

INDmoney, 16 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

PCBL Chemicals: Can its diversification drive the next growth cycle?

The Indian Express, 11 Jul

PCBL Chemical Reports Q1 Consolidated Net Profit of ₹1.5B Versus ₹940.5M YoY

Sahi, 29 JulResults

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

PCBL Chemical Shares Rise 2.06% to ₹337.25 as Carbon Black Stock Nears Resistance - Range Breakout

https://www.siam.in/, 30 SeptPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

PCBL Chemical shares gain 25% in 6 months on supply, export optimism

The Economic Times, 08 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

PCBL Chemical Stock Signals to Watch This Week

Univest, 23 Sept

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

MiddlingRisk

WeakBusiness Quality · Financial Health · Growth · Profitability · Valuation

Points for each in the Score ↑

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. 2 high-severity red flags sit above this conclusion and should be read first.

2 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x · see Key things to watch ↑