The Indian chemical sector is a significant part of the country’s industrial landscape and is one of the largest producers and exporters of chemicals worldwide. It is poised for robust growth, driven by strong domestic demand, increasing exports, and supportive government policies.
Listed below is a Fundamentally strong chemical stock, the leading specialty marine chemical manufacturer in India, in which Foreign Institutional Investors have increased their holding in Q1FY25
Archean Chemical Industries
Archean Chemical Industries Limited is one of India’s largest exporters of bromine and industrial salt. It is a leading specialty marine chemical manufacturer in India, focused on producing and exporting bromine, industrial salt, and potash sulfate to customers across the world.
Archean Chemical Industries Limited serves a range of industries, including agriculture, agrochemicals, pharmaceuticals, flame retardants, water treatment, aluminum, Food & Beverage, oil & gas, glass, textiles, and many more.
It has a strong clientele base with more than 39 Global and 30 Domestic Players, some of the major clients include Tianvi Group, Uninbrom, Wanhua, Sojitz Corporations, and many others.
Foreign Institutional Investors increase their stake
In Q1FY25 Foreign Institutional Investors increased their holding in Archean Chemical Industries Limited from 5.86 percent in Q4FY24 to 9.53 percent in Q1FY25 by purchasing an additional 3.67 percent stake. The FII’s have consistently increased their holding in the company from the past 3 quarters.
Expansion Plans
Brownfield Expansion
It has added a feed enrichment section at the site in Hajipir, Gujarat which increased Bromine capacity by 18,000 MT per annum. Added an additional 14,500 MT per annum capacity in FY23 which will be used for producing Bromine Derivatives in the upcoming greenfield project.
It Intends to expand the manufacturing capacities for Industrial Salt production by adding one additional washery of 250 tons per hour
Greenfield Expansion
The Phase 1 expansion of the new facility at Jhagadia, GIDC through Acume Chemicals Private Limited (Subsidiary) is commissioned in Q4FY24 to manufacture Bromine Performance Derivatives. The Phase 2 expansion is expected to be commissioned by the end of H1FY25.
Financials and Ratios
Its revenue from operations declined by 25.89 percent from Rs. 382 Crores in Q4FY23 to Rs. 282 Crores in Q4FY24, accompanied by profits of Rs. 137 Crores to Rs. 60 Crores.
In terms of Return ratios, it has reported a return on equity (ROE) of 19.4 percent, and a return on capital employed (ROCE) of 25.8 percent. It has reported a debt-to-equity ratio of 0.02.
Written by: Bharath K.S
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