1. At a Glance
Tata Chemicals dropped its Q1 numbers with all the excitement of a science fair where the volcano doesn’t erupt. Revenue came in at ₹3,719 Cr, profit at ₹316 Cr, but margins still feel like they’re made of… baking soda. Low ROE, poor 3-year growth, but hey — at least the dividend is more loyal than the shareholders.
2. Introduction with Hook
Imagine running the world’s 3rd largest soda ash biz and still struggling to fizz in your P&L. Tata Chemicals is the chemical version of a great legacy player trying to vibe with a Zomato crowd. The problem? Specialty chemicals fizzled, margins got mugged, and ROCE is lounging at just 4%.
- Q1 FY26 Profit: ₹316 Cr (after a comeback from negative PATs)
- ROE: 1.2% (don’t blink, you’ll miss it)
- P/E: 52x (because we like our chemicals expensive and our returns mysterious)
3. Business Model (WTF Do They Even Do?)
They basically sell salt and soda. But in a boardroom tone.
- Core Segments:
- Basic Chemistry: Soda ash, sodium bicarbonate, salt, cement
- Specialty Products: Nutrition, agro-chem, and silica
- Global Biz Footprint:
- India, US, UK, Kenya
- Over ⅔ of soda ash is from natural sources = cost advantage… allegedly
They also own 51% of Rallis India, so you can add agri-science to the cocktail.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 TTM |
|---|---|---|---|
| Revenue (₹ Cr) | 16,789 | 15,421 | 14,817 |
| EBITDA (₹ Cr) | 3,820 | 2,847 | 2,028 |
| Net Profit (₹ Cr) | 2,434 | 435 | 513 |
| EPS (₹) | 90.9 | 10.5 | 13.2 |
| ROE (%) | 12% | 1% | 1.2% |
Commentary:
Sales shrinking. Margins evaporating. Net profit got decimated. This is the Tata Group’s sleepy stepchild.
5. Valuation
- P/E (TTM): 52
- P/BV: 1.11x
- Dividend Yield: 1.17%
Fair Value Range: ₹680 – ₹780
If you’re paying 52x earnings for a company with flat sales and 1.2% ROE, we hope you also buy popcorn at airport lounges.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 Results:
- Revenue: ₹3,719 Cr
- EBITDA: ₹649 Cr
- PAT: ₹316 Cr
(Somewhat better — but you’re still comparing against a burning wreck)
- Tax Adjustments & Exceptionals: Kept the PAT in green
- Specialty Biz: Still under pressure
- Management Commentary: “We are optimistic” — ah yes, the ancient corporate spell for “pray for margins”
7. Balance Sheet
| FY | Equity | Reserves | Debt | Net Worth | Total Assets |
|---|---|---|---|---|---|
| FY23 | ₹255 Cr | ₹19,466 Cr | ₹6,296 Cr | ₹19,721 Cr | ₹34,940 Cr |
| FY25 | ₹255 Cr | ₹21,339 Cr | ₹7,072 Cr | ₹21,594 Cr | ₹37,750 Cr |
Solid balance sheet, manageable debt. But that asset base isn’t translating to returns anymore. Book value’s ₹847 — CMP is 1.1x that. Not bad, but definitely not exciting.
8. Cash Flow – Sab Number Game Hai
| FY | CFO | CFI | CFF | Net CF |
|---|---|---|---|---|
| FY24 | ₹3,016 Cr | -₹605 Cr | -₹2,494 Cr | -₹83 Cr |
| FY25 | ₹1,761 Cr | -₹1,667 Cr | ₹29 Cr | ₹123 Cr |
Cash flow from ops is the only steady thing in this story. Investing heavily into capacity and projects — but financing is near-zero. Capex is fine, but results need to follow.
9. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 TTM |
|---|---|---|---|
| ROCE | 12% | 8% | 4% |
| ROE | 12% | 1% | 1.2% |
| PAT Margin | 14% | 3% | 3.4% |
| D/E | 0.3x | 0.26x | 0.32x |
ROE = practically in hibernation. PAT margin fell off a cliff. Only silver lining? Still low leverage.
10. P&L Breakdown – Show Me the Money
| FY | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹16,789 Cr | ₹3,820 Cr | ₹2,434 Cr |
| FY24 | ₹15,421 Cr | ₹2,847 Cr | ₹435 Cr |
| FY25 TTM | ₹14,817 Cr | ₹2,028 Cr | ₹513 Cr |
EBITDA margin collapsing like a failed soufflé. PAT got knocked from ₹2,400 Cr to ₹500 Cr — and they’re still charging premium valuations.
11. Peer Comparison
| Company | Revenue | PAT | P/E | ROE |
|---|---|---|---|---|
| SRF | ₹15,048 Cr | ₹1,431 Cr | 63 | 10.4% |
| GNFC | ₹7,892 Cr | ₹597 Cr | 13 | 7.1% |
| GHCL | ₹3,183 Cr | ₹601 Cr | 9.7 | 18.6% |
| Tata Chemicals | ₹14,817 Cr | ₹513 Cr | 52 | 1.2% |
Looks like the most overvalued cousin at the chemical family reunion.
12. Miscellaneous – Shareholding, Promoters
Promoter Holding: 38% (flat)
FIIs: Falling — now at 12.85%
DIIs: Rising — now at 22.6%
Public: 26.5%
No. of Shareholders: 6.7 lakh — seems like the retail crowd isn’t fully giving up… yet.
13. EduInvesting Verdict™
Tata Chemicals is not the Tata you buy for 20% CAGR dreams. It’s for those who like dividends and legacy and aren’t in a hurry. Specialty chemical turnaround? Maybe. But for now, this is basic chemistry with complex issues.
A slow brew. Smells nice, sips average. Definitely not espresso.
Written by EduInvesting Team | 25 July 2025
Tags: Tata Chemicals, Soda Ash, Specialty Chemicals, Tata Group, Dividend Stocks, Q1 FY26, EduInvesting Premium
