Fairval

Notes on Indian equities, sectors and economy

Vinyl Sulphone and H-acid: the new party chemicals

Posted by fairval on August 11, 2014

Vinyl Sulhone and H-Acid are the new party drugs. Well, in a manner of speaking!

These are actually dye intermediates, which are enjoying a bull run in prices (probably temporary). Prices have risen >2x normal levels, margins have expanded dramatically, it seems due to global capacity shortage. The companies manufacturing these are having a whale of time. We know of 4 manufacturers: Bodal Chem, Bhageria Dye Chem, Kiri Industries and Akshar Chem.

Among the lot, Bodal declared results last week and Bhageria came out with results today. And what blow out results, for both!

This is what Bodal declared:

(Rs mn) AMJ-14 AMJ-13 FY14
Sales 3853 1765 9595
EBITDA 920 166 1889
PAT 520 19 307

And Bhageria’s results are equally good:

(Rs mn) AMJ-14 AMJ-13 FY14
Sales 1816 498 3674
EBITDA 257 27 248
PAT 165 16 154

Kiri and Akshar Chem are yet to declare results. All the 3 scrips have risen dramatically, by 10-15x in the last 2-3 quarters.

What we don’t know is how long the party will last. Polyester film makers had dramatic run in FY12, where all companies posted unheard of profits, but now they are back to 2-3% net margin. Hope the crash isnt too bad here.

 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: