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Last Updated on: 22 November, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 543252 | NSE: FAIRCHEMOR

Fairchem Organics Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: November 21, 2024, 10:13 pm

Market Cap 1,022 Cr.
Current Price 783
High / Low1,553/775
Stock P/E24.4
Book Value 229
Dividend Yield0.96 %
ROCE19.4 %
ROE14.7 %
Face Value 10.0
PEG Ratio-20.58

Stock P/E, Current Price, and Intrinsic Value Over Time

View Share Price Target for Fairchem Organics Ltd

Competitors of Fairchem Organics Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Gujchem Distillers India Ltd 108 Cr. 304541/61.8285 3900.00 %1.38 %2.17 % 1.00
Elantas Beck India Ltd 10,175 Cr. 12,83114,980/6,44569.3 1,0180.04 %27.7 %20.6 % 10.0
Crestchem Ltd 87.3 Cr. 291350/70.027.6 21.10.17 %78.2 %56.2 % 10.0
Chemiesynth (Vapi) Ltd 11.0 Cr. 35.834.1/0.00 37.50.00 %1.00 %3.38 % 10.0
Archit Organosys Ltd 90.1 Cr. 43.963.6/35.1125 32.20.00 %3.69 %0.75 % 10.0
Industry Average6,949.00 Cr1,987.9373.49312.950.27%16.32%12.33%7.67

All Competitor Stocks of Fairchem Organics Ltd

Quarterly Result

MonthMar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Sales159139168158178225169102152161152148161
Expenses13210613613715918515999133149135128142
Operating Profit283332211940941912172019
OPM %17%24%19%13%11%18%6%4%13%7%11%13%12%
Other Income0000000000000
Interest2222222111111
Depreciation2222222222223
Profit before tax24302818153661168141716
Tax %22%25%25%26%26%25%29%35%26%26%26%26%26%
Net Profit19222113112741126101212
EPS in Rs14.4617.1316.0510.338.6320.763.070.479.114.707.909.479.03

Last Updated: Unknown

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: Unknown

MonthMar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Sales306397643648621
Expenses258328538576554
Operating Profit49691057267
OPM %16%17%16%11%11%
Other Income60011
Interest77764
Depreciation67789
Profit before tax4256915955
Tax %18%24%26%26%26%
Net Profit3542684440
EPS in Rs32.6252.1533.4131.10
Dividend Payout %0%11%25%22%24%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)20.00%61.90%-35.29%-9.09%
Change in YoY Net Profit Growth (%)0.00%41.90%-97.20%26.20%

Fairchem Organics Ltd has shown an inconsistent trend in YoY Net Profit Growth (%) in the last 4 years from 2020-2021 to 2023-2024.

Growth

Compounded Sales Growth
10 Years:%
5 Years:%
3 Years:16%
TTM:8%
Compounded Profit Growth
10 Years:%
5 Years:%
3 Years:-2%
TTM:45%
Stock Price CAGR
10 Years:%
5 Years:%
3 Years:-24%
1 Year:-34%
Return on Equity
10 Years:%
5 Years:%
3 Years:21%
Last Year:15%

Last Updated: Unknown

Balance Sheet

Last Updated: November 15, 2024, 12:33 am

MonthMar 2020Mar 2021Mar 2022Mar 2023Mar 2024Sep 2024
Equity Capital0.001313131313
Reserves127156219246277285
Borrowings67576250744
Other Liabilities253330333740
Total Liabilities219259324342334383
Fixed Assets126126141156191191
CWIP9294235615
Investments000000
Other Assets83103141151137177
Total Assets219259324342334383

Reserves and Borrowings Chart

Cash Flow

MonthMar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity +3140405074
Cash from Investing Activity +-24-23-34-14-18
Cash from Financing Activity +-7-17-6-35-57
Net Cash Flow00-000

Free Cash Flow

MonthMar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow-18.0012.0043.0022.0060.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days4543353533
Inventory Days6564576157
Days Payable12157811
Cash Conversion Cycle9891858980
Working Capital Days6772697467
ROCE %30%38%22%19%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthSep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
Promoters74.06%58.89%58.88%58.88%58.85%58.89%58.89%58.89%58.89%58.89%58.89%58.71%
FIIs0.32%6.22%6.34%6.15%6.22%6.24%6.23%6.24%6.19%6.22%6.29%6.29%
DIIs1.56%5.32%5.39%5.46%5.48%5.40%5.19%5.23%5.33%5.28%5.26%5.16%
Public24.06%29.56%29.39%29.50%29.45%29.48%29.69%29.65%29.59%29.61%29.56%29.84%
No. of Shareholders16,01223,45924,64724,39829,81732,86933,13733,20833,35231,66531,49631,601

Shareholding Pattern Chart

No. of Shareholders

This stock is not held by any mutual fund

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue10.0010.0010.0010.0010.00
Basic EPS (Rs.)31.1033.4152.1532.6326.65
Diluted EPS (Rs.)31.1033.4152.1532.6326.65
Cash EPS (Rs.)38.2339.6757.6337.680.00
Book Value[Excl.RevalReserv]/Share (Rs.)222.67199.11178.29129.590.00
Book Value[Incl.RevalReserv]/Share (Rs.)222.67199.11178.29129.590.00
Dividend / Share (Rs.)7.507.5013.003.500.00
Revenue From Operations / Share (Rs.)477.29497.69493.96304.560.00
PBDIT / Share (Rs.)52.3156.0780.8152.960.00
PBIT / Share (Rs.)45.1949.8175.3447.910.00
PBT / Share (Rs.)41.9345.0070.0742.670.00
Net Profit / Share (Rs.)31.1033.4152.1532.630.00
PBDIT Margin (%)10.9611.2616.3617.3817.93
PBIT Margin (%)9.4610.0015.2515.7315.98
PBT Margin (%)8.789.0414.1814.0113.83
Net Profit Margin (%)6.516.7110.5510.7111.32
Return on Networth / Equity (%)13.9616.7729.2525.1730.52
Return on Capital Employeed (%)19.0823.5238.2130.0131.44
Return On Assets (%)12.1112.7020.9516.4215.85
Long Term Debt / Equity (X)0.000.000.040.150.14
Total Debt / Equity (X)0.020.190.260.280.53
Asset Turnover Ratio (%)1.841.942.211.660.00
Current Ratio (X)5.102.222.041.931.19
Quick Ratio (X)2.421.030.991.040.62
Inventory Turnover Ratio (X)6.126.698.176.890.00
Dividend Payout Ratio (NP) (%)24.1138.916.710.0030.22
Dividend Payout Ratio (CP) (%)19.6132.776.070.0025.79
Earning Retention Ratio (%)75.8961.0993.290.0069.78
Cash Earning Retention Ratio (%)80.3967.2393.930.0074.21
Interest Coverage Ratio (X)16.0711.6615.3510.118.35
Interest Coverage Ratio (Post Tax) (X)10.557.9510.917.236.27
Enterprise Value (Cr.)1552.811240.342021.191022.580.00
EV / Net Operating Revenue (X)2.501.913.142.580.00
EV / EBITDA (X)22.8016.9919.2114.830.00
MarketCap / Net Operating Revenue (X)2.491.843.052.460.00
Retention Ratios (%)75.8861.0893.280.0069.77
Price / BV (X)5.334.598.445.780.00
Price / Net Operating Revenue (X)2.491.843.052.460.00
EarningsYield0.020.030.030.040.00

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of Fairchem Organics Ltd as of November 22, 2024 is: 829.26

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

As of November 22, 2024, Fairchem Organics Ltd is Undervalued by 5.91% compared to the current share price 783.00

Intrinsic Value of Fairchem Organics Ltd as of November 22, 2024 is: 819.43

Calculation basis:

  • Intrinsic value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the intrinsic value of the stock by analyzing its fundamental indicators along with EPS growth.

As of November 22, 2024, Fairchem Organics Ltd is Undervalued by 4.65% compared to the current share price 783.00

Last 5 Year EPS CAGR: -1.19%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 21.80%, which is a positive sign.
  2. The company has higher reserves (218.33 cr) compared to borrowings (47.83 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (523.00 cr) and profit (60.60 cr) over the years.
  1. The stock has a high average Working Capital Days of 69.80, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 88.60, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in Fairchem Organics Ltd:
    1. Net Profit Margin: 6.51%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 19.08% (Industry Average ROCE: 16.32%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 13.96% (Industry Average ROE: 12.33%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 10.55
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 2.42
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 24.4 (Industry average Stock P/E: 73.49)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.02
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

Fairchem Organics Ltd. is a Public Limited Listed company incorporated on 27/03/2019 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L24200GJ2019PLC129759 and registration number is 323176. Currently Company is involved in the business activities of Manufacture of various other chemical products(antiknock preparations, anti-freeze preparations, liquids for hydraulic transmission, composite diagnostic or laboratory reagents, writing or drawing ink, chemical substance used in manufacturing of pesticides and other chemical products). Company’s Total Operating Revenue is Rs. 643.18 Cr. and Equity Capital is Rs. 13.02 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
Chemicals - Organic - Others253/P & 312, Village Chekhala, Ahmedabad District Gujarat 382115cs@fairchem.in
http://www.fairchem.in
Management
NamePosition Held
Mr. Nahoosh JariwalaChairman & Managing Director
Mr. Sudhin ChokseyIndependent Director
Mr. Venkatraman SrinivasanIndependent Director
Mr. Darius PandoleIndependent Director
Ms. Sonal AmbaniIndependent Director
Mr. Sumit MaheshwariNominee Director

FAQ

What is the latest intrinsic value of Fairchem Organics Ltd?

The latest intrinsic value of Fairchem Organics Ltd as on 21 November 2024 is ₹829.26, which is 5.91% higher than the current market price of ₹783.00.

What is the Market Cap of Fairchem Organics Ltd?

The Market Cap of Fairchem Organics Ltd is 1,022 Cr..

What is the current Stock Price of Fairchem Organics Ltd as on 21 November 2024?

The current stock price of Fairchem Organics Ltd as on 21 November 2024 is ₹783.

What is the High / Low of Fairchem Organics Ltd stocks in FY 2024?

In FY 2024, the High / Low of Fairchem Organics Ltd stocks is 1,553/775.

What is the Stock P/E of Fairchem Organics Ltd?

The Stock P/E of Fairchem Organics Ltd is 24.4.

What is the Book Value of Fairchem Organics Ltd?

The Book Value of Fairchem Organics Ltd is 229.

What is the Dividend Yield of Fairchem Organics Ltd?

The Dividend Yield of Fairchem Organics Ltd is 0.96 %.

What is the ROCE of Fairchem Organics Ltd?

The ROCE of Fairchem Organics Ltd is 19.4 %.

What is the ROE of Fairchem Organics Ltd?

The ROE of Fairchem Organics Ltd is 14.7 %.

What is the Face Value of Fairchem Organics Ltd?

The Face Value of Fairchem Organics Ltd is 10.0.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in Fairchem Organics Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE