Best Mid Cap Chemical Stocks: Midcap stocks have immense potential to become the next large-cap or even blue-chip stocks. These companies are in their growing stage and have the potential to unlock value.  In addition, the chemical industry is currently facing headwinds and the companies are emphasizing on research and development activities. So, in this article, we will look into the Best Mid Cap Chemical Stocks in India.

Best Mid Cap Chemical Stocks in India

Best Mid Cap Chemical Stocks #1: Gujarat Fluorochemicals Ltd

Gujarat Fluorochemicals Ltd. Logo

The company commenced commercial operations in 1989 with the building of India’s largest refrigerant manufacturing factory at Ranjitnagar, Gujarat, India.  They upgraded plants to produce fluoro-specialized items to meet the expanding demand in the global agriculture and pharmaceutical industries.

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Gujarat Fluorochemicals Ltd expanded into new markets in 2007 with one of the world’s most integrated facilities in Dahej, Gujarat, India, and currently has a comprehensive array of fluoropolymers that includes PTFE, PFA, FEP, FKM, PVDF, and fluoropolymer additives.

With three manufacturing sites in Gujarat, India, located in Ranjoit Nagar, Dahej, and Jova, a captive fluorspar mine in Morocco, offices and warehouses in Europe and the United States, and a global marketing network.

In FY23, the firm earned revenue from the sale of items such as bulk chemicals (20.39%), fluorochemicals (27.13%), and fluoropolymers (52.48%), across geographies such as India (40.11%), Europe (21.08%), the United States (26.36%), and the rest of the world (12.44%).

The company reported a 43.78% increase in revenue for FY23, to Rs. 5,684.66 crore, and a 70.52% increase in net profit, to Rs. 1,323.04 crore. RoCE outperformed RoE. RoE was 27.07%, and RoCE was 29.71%.

ParticularsAmountParticularsAmount
CMP₹ 3,487.9Market Cap (Cr.)₹ 37,618
EPS (TTM)₹ 83.32P/E (TTM)34.7
RoE (%)27.07%RoCE (%)29.71%
Book Value per Share₹ 523.53Dividend Yield0.14
Enterprise Value (Cr.)₹ 33,186.26Price to Book Value5.52

Best Mid Cap Chemical Stocks #2: Deepak Nitrite Ltd

Best Mid Cap Chemical Stocks - Deepak Nitrite Ltd - Logo Image

Deepak Nitrite Ltd was founded in 1970. With a customer base of 1,000+ and products ranging from 30+ to 56+ applications, the company specializes in products such as basic chemicals, fine and specialty chemicals, performance products, and phenolics. Bayer, Unilever, Indian Oil, Rallis India, BASF, Loreal, Lubrizol, Reliance Industries, and Nirma are among their clientele.

The company has a presence in more than 45 countries across six continents. Their revenue segmentation from Advanced Intermediaries was 38.05%, with Phenolics accounting for 61.94%. In FY23, India accounted for 80.40% of their income, with the remaining 19.60% coming from outside India.

The company’s revenues increased by 17.19% in FY23 to Rs. 7,972.06 crore. Net profit was Rs. 852 crore, a 20.60% decrease year on year. RoCE outperformed RoE, and the ratio was 30.13% due to a decrease in earnings.

ParticularsAmountParticularsAmount
CMP₹ 2,431.35Market Cap (Cr.)₹ 33,226
EPS (TTM)₹ 58.50P/E (TTM)37.51
RoE (%)22.94%RoCE (%)30.13%
Debt to Equity0.01FII Holdings (%)6.47%
Enterprise Value (Cr.)₹ 29,941.30Price to Book Value6.89

Best Mid Cap Chemical Stocks #3: Tata Chemicals Ltd

Tata Chemicals Ltd - Logo

The company was founded in 1939. The company is divided into two segments: basic chemistry products and specialty products. The Basic Chemistry product line of the company supplies critical ingredients to many of the world’s leading brands in glass, detergents, medicines, biscuit making, bakeries, and other industries.

Tata Chemicals maintains one of Asia’s largest saltworks, as well as being the world’s third-largest manufacturer of soda ash and sixth-largest manufacturer of sodium bicarbonate.

Tata Chemicals invented Fossence, a nutritious prebiotic product that is sold to B2B customers in India, North America, Europe, the Middle East, and Asia. Through its subsidiary company, Rallis India Ltd., the corporation has a prominent position in the crop protection market.

Highly Dispersible Silica, a patented green manufacturing technique, focuses on adding value to various sectors, including high-performance tires, oral care, paints and additives, and so on.

The company is in the early stages of developing a platform in energy sciences to provide cutting-edge solutions based on Lithium Ion cell technology.

Basic chemistry accounts for 80.82% of income, with goods such as soda ash contributing 57.45%, salt 12.28%, bicarb 4.73%, and others 6.34%. In FY23, the specialty products revenue section accounts for 19.04% of total revenue, with Crop protection accounting for 14.38%, Seeds accounting for 2.02%, Others accounting for 2.63%, and unallocated revenue accounting for 0.13%.

Across geographies, the company earns 42.98% of its revenue from India, 5.37% from Asia, 15.52% from Europe, 2.94% from Africa, 32.96% from America, and 0.22% from the rest of the globe.

The company recorded revenue of Rs. 16,789 crore, up 33% year on year. Net profits were Rs. 2,434 crore, up 73.28% year on year. The RoE and RoCE were 12.91% and 12.37%, respectively. RoE outperformed RoCE, which is better for shareholders.

ParticularsAmountParticularsAmount
CMP₹ 1,105Market Cap (Cr.)₹28,092
EPS (TTM)₹ 80.86P/E (TTM)11.98
RoE (%)12.91%RoCE (%)12.37%
Book Value per Share₹ 840.13Dividend Yield1.81
Enterprise Value (Cr.)₹ 29,420.42Price to Book Value1.15

Best Mid Cap Chemical Stocks #4: Godrej Industries Ltd

Godrej Industries Ltd - Logo Image

The company was founded in 1988. Godrej Industries Ltd. is a Godrej Group company that manufactures and markets consumer goods and other related products. The company’s goods include oleochemicals and surfactants, animal feeds, poultry, and agro-products, as well as personal and home care items.

It sells its goods under the Godrej brand name. It also engaged in real estate development, real estate investing, and oil palm plantation businesses. Godrej Industries is based in Maharashtra, with factories in Ambernath, Wadala, Valia, and Dombivali. The operations of the company are distributed across India, Indonesia, and Singapore. The headquarters of Godrej Industries are in Mumbai, Maharashtra, India.

The chemical business has a strong global presence and exports to over 70 countries. The company operates two factories in Gujarat and Maharashtra. The company’s products include fatty alcohols, fatty acids, surfactants, glycerin, and oleochemical derivatives. 

Chemicals are one of the sources of revenue for the organization. In FY23, income was divided as follows: Chemicals – 23.44%; animal feeds – 27.90%; vegetable Oils – 10.85%; estate and property development – 17.43%; Dairy – 8.45%; crop protection – 6.73%; finance and investments – 2.20%; and Others – 2.97%.

India accounts for 88.11% of revenue, with the remaining 11.88% coming from the rest of the world.

In FY23, the company’s revenue was Rs. 16,740.25 crore, an increase of 18.47%. Net profits increased from 43.08% to Rs. 1,420.64 crore. RoE and RoCE were 18.83% and 10.72%, respectively. RoE has outperformed RoCE.

ParticularsAmountParticularsAmount
CMP₹ 836.95Market Cap (Cr.)₹ 28,531
EPS (TTM)₹ 26.14P/E (TTM)25.6
RoE (%)18.83%RoCE (%)10.72%
Book Value per Share₹ 244.26Dividend Yield0
Enterprise Value (Cr.)₹ 45,648.98Price to Book Value2.74

Best Mid Cap Chemical Stocks #5: Aarti Industries Ltd

Best Mid Cap Chemical Stocks - Aarti Industries Ltd - Logo Image

Aarti Industries Limited, established in 1984, is a specialized chemical firm specializing in benzene-based derivatives.  With a presence in over 60 countries. The company’s experience in process chemistry, innovation, and engineering to create tailored solutions for a wide range of downstream sectors. To give long-term solutions to stakeholders, the organization prioritizes the use of green chemistry.

In FY23, domestic revenue accounts for 52% of total revenue, with exports accounting for the remaining 48%. Exports are also geographically diverse, with 15% from the rest of the world, 13% from North America, 11% from Europe, 6% from China, and 3% from Japan accounting for 48% of revenue in FY23.

In FY23, revenue increased by 5.98% to Rs. 7,282.62 crore. Net earnings were Rs. 545.23 crore, a 54.01% decrease. RoE exceeded RoCE, which stood at 11.56% and 10.48%, respectively.

ParticularsAmountParticularsAmount
CMP₹ 621.95Market Cap (Cr.)₹ 21,868
EPS (TTM)₹ 12.32P/E (TTM)43.01
RoE (%)11.56%RoCE (%)10.48%
Book Value per Share₹ 138.74Dividend Yield0.47
Enterprise Value (Cr.)₹ 21,926.65Price to Book Value3.82

List of Best Mid Cap Chemical Stocks

Let us see some of the Best Mid Cap Chemical Stocks and small cap stocks in the chemical sector.

Company NameCMPMarket Cap (Cr.)P/E (TTM)
Gujarat Fluorochemicals Ltd.₹ 3,485.2₹ 37,61834.7
Deepak Nitrite Ltd.₹2,441.45₹ 33,22637.51
Tata Chemicals Ltd.₹ 1,123.2₹ 28,09211.98
Godrej Industries Ltd.₹ 836.05₹ 28,531 25.6
Aarti Industries Ltd.₹ 622.15₹ 21,86843.01
Navin Fluorine International Ltd.₹ 3,542.95₹ 17,35350.13
Vinati Organics Ltd.₹ 1,721.4₹ 17,78643.57
Clean Science and Technology Ltd.₹ 1,528₹ 15,944 51.86
Fine Organic Industries Ltd.₹ 4,729.75₹ 14,78528.22
BASF India Ltd.₹ 3,034.5₹ 13,21235.97

Conclusion

As we near the end, the midcap area can produce future multi-baggers. However, only some companies will grow at the rate we anticipate. For years, the market dynamics and macroeconomic shifts will test every company’s ability to overcome, and those companies have the potential to develop from mid-cap to large-cap space. What are your thoughts on these businesses? Do they hold potential? Please share your thoughts in the comments box below.

Written by Santhosh

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