Meghmani Finechem zooms 28% in two trading sessions post robust Q4 results

Q4 ebitda margin was up by 405 bps to 35 per cent on the back of strong operational efficiency and internal cost control measures.

Shares of Meghmani Finechem hit a record high of Rs 1,469.55 on rallying 14 per cent on the BSE in Tuesday’s intra-day trade. The stock has zoomed 28 per cent in the past two trading days after the company reported a robust operating and financial performance for March quarter (Q4FY22). In the past seven weeks, the stock of the specialty chemicals has zoomed 91 per cent from a level of Rs 771 on March 7, 2022.

In Q4, the company’s profit after tax (PAT) tripled to Rs 99 crore from Rs 33 crore in previous year quarter, on the back of strong sales. Revenue from operations grew 93 per cent to Rs 499 crore from Rs 259 crore in Q4FY21.

Earnings before interest, taxes, depreciation, and amortization (ebitda) increased by 118 per cent to Rs 175 crore from Rs 80 crore in Q4FY21 and ebitda margin was up by 405 bps to 35 per cent, despite high inflationary pressure on raw materials. “Strong operational efficiency and internal cost control measures allowed the company to maintain margins even with the inflationary pressure,” the management said.

The management announced a 5-year vision of achieving Rs 5,000 crore in revenue by FY27, translating to a revenue CAGR of 25 per cent from here on. This growth will come from higher revenue contribution of value-added derivatives & specialty chemical. The company has announced to enter in Chlorotoluene & its value chain and in phased manner will keep on announcing its further capex in the future, the management said.

Meghmani Finechem is a leading manufacturer of chlor-alkali products and value-added derivatives. The company is India’s 4th largest manufacturer of caustic soda, chlorine and hydrogen and a leading manufacturer of caustic potash, chloromethanes and hydrogen peroxide.

The company is now expanding its product base to include derivative and specialty chemical products like Epichlorohydrin (ECH), Chlorinated Polyvinyl Chloride (CPVC) and Chlorotoluene & its value chain, which are a key raw material for multiple end user industries, which are presently catered by 100 per cent import.