1. At a Glance
Archean Chemical Industries Ltd — the bromine boss of Bharuch and industrial salt superstar — just reported its Q2FY26 results, and let’s just say the chemistry is losing some sparkle. The stock has tumbled-21% in the last three months, and FY26 is turning into a real acid test. The company’sQ2FY26 consolidated revenue stood at ₹233 crore, down3.03% QoQ, whilePAT nosedived 40.5% QoQto₹29.1 crore. That’s not just a slip — that’s bromine burning through profits.
At₹541 a share, the company commands amarket cap of ₹6,673 croreand trades at aP/E of 39.1×, a premium that screams “hopeium” rather than fundamentals. ItsROCE is 12.8%andROE at 9.8%, both showing that even with all the chemistry, the reaction isn’t exothermic enough. Meanwhile, promoters hold53.4%stake, with12% of it pledged, making investors slightly nervous — because even the promoters are hedging their bromine bets.
The good news? Archean still remainsIndia’s largest exporter of bromine and industrial salt, and one of the lowest-cost producers globally. The bad news? The cyclical salt game is turning soggy.
So, is Archean still a specialty chemical gem or a marine salt shaker pretending to be a semiconductor stock? Let’s dive in.
2. Introduction
Archean Chemical started as the salty kingpin of India’s marine chemicals — an exporter who made bromine cool long before chemistry memes existed. But 2025 hasn’t exactly been kind. With global bromine demand fluctuating, shipping costs rising, and competitors catching up, Archean’s once-sparkling margins are showing corrosion marks.
This fiscal year, the company tried to distract the market with a tech twist — announcing itsSiCSem Private Limitedsubsidiary’s₹2,067 crore compound semiconductor fab in Bhubaneswar, approved by theUnion Cabinetin August 2025. On paper, that’s a bold diversification move; in reality, it’s a leap from bromine tanks to clean rooms. The question every analyst is asking: can a salt exporter really build silicon chips?
While the management is busy signingUSD 12 million Offgrid Energy Labsinvestments and conductingbhoomi poojansfor semiconductor fabs, the P&L quietly screams: profits down 40%, margins falling, and CRISIL revising outlook to “Stable → Negative.”
So yes, Archean’s investor story right now reads like a chemistry student suddenly enrolling in computer science — ambitious, but probably needs a lot of lab time.
3. Business Model – WTF Do They Even Do?
At its salty core, Archean Chemical Industries is India’sleading marine chemical manufacturer, producingbromine, industrial salt, and sulphate of potash (SOP). Its operations revolve around extracting minerals from brine reservoirs in theRann of Kutch, then refining, processing, and exporting them to global customers.
Here’s how the business breaks down:
- Bromine– Used in flame retardants, pharmaceuticals, water treatment, and agrochemicals. Archean is India’s largest exporter, competing with global players like Israel Chemicals and Albemarle.
- Industrial Salt– Supplied to chemical and detergent manufacturers across Asia. Archean is again India’s biggest exporter, which is basically the marine equivalent of being the country’s “Salt Bae.”
- SOP (Sulphate of Potash)– A niche fertilizer used for high-value crops.
Now comes the twist: Archean has gone full sci-fi. ThroughSiCSem Private Limited, its step-down subsidiary, it’s entering thesemiconductor materialsbusiness — focusing onSilicon Carbide (SiC)compound semiconductors. This venture gotUnion Cabinet approval for ₹2,067 crorein August 2025. The bhoomi poojan is done; now we wait to see if bromine cash can really fuel a chip dream.
So in short:
- Past = Marine chemicals.
- Present = Bromine exporter with declining margins.
- Future = “Make in India” semiconductor fab dreams.
A chemical company trying to play tech stock — what could go wrong?
4. Financials Overview
Quarterly Performance (Consolidated Figures in ₹ crore)
| Metric | Latest Qtr (Sep’25) | YoY Qtr (Sep’24) | Prev Qtr (Jun’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 233 | 240 | 292 | -2.9% | -20.2% |
| EBITDA | 63 | 75 | 78 | -16.0% | -19.2% |
| PAT | 29.1 | 16.0 | 40.0 | +81.9% | -40.5% |
| EPS (₹) | 2.36 | 1.28 | 3.26 | +84.4% | -27.6% |
Commentary:
Archean’s Q2FY26 performance shows both chemistry and chaos. YoY, it looks decent — PAT doubled from ₹16 crore to ₹29 crore — but sequentially, things went downhill fast. EBITDA margins at 27% are far from the 51% glory days of FY23. If bromine prices don’t stabilize, Archean’s profitability could continue evaporating faster than seawater at its evaporation ponds.
5. Valuation Discussion – Fair Value Range
Let’s break it down with cold math (and a pinch of salt).
(a) P/E Based Method:
- Current EPS (TTM): ₹13.8
- Industry P/E: 28.6×
- Fair Value Range = 28.6 × ₹13.8 → ₹395 – ₹420 per share
(b) EV/EBITDA Method:
- EV: ₹6,902 crore
- EBITDA (TTM): ₹309 crore
- EV/EBITDA = 22.3× (premium to peers)Assuming fair multiple of 15–17× → Fair Value = ₹465 – ₹525 per share
(c) DCF Snapshot (Conservative):Using OCF of ₹176 crore (FY25), growth 8%, discount 12%, terminal 3% → ₹500–₹550 range
Educational Fair Value Range: ₹400–₹550 per share.
Disclaimer: This range is for educational purposes only and not investment advice. Do your own chemistry before mixing acids and equities.
6. What’s Cooking – News, Triggers, Drama
2025 has been Archean’s most action-packed year — part industrial saga, part IT thriller.
- Cyclone Losses:The company reported₹40.18 crore (₹4,018.27 lakh)loss from cyclone damages in Q2FY26. Nature clearly didn’t like bromine this quarter.
- Income Tax Search:In September 2025, theIncome Tax Departmentconducted searches at Archean and its subsidiaries. Management says “impact unknown.” Translation: “We’re still counting.”
- Credit Rating:CRISIL reaffirmed rating atA, but changed outlook toNegativeon September 18, 2025. That’s like your CA saying, “You’re solvent, but we’re watching you.”
- Semiconductor Foray:Union Cabinet approved a₹2,067 crore SiC fabby subsidiary SiCSem. The bhoomi poojan happened on November 1, 2025.
- Foreign Investments:USD 12 million inOffgrid Energy Labs Inc., plus GBP 15 million in other tech-linked ventures — because apparently bromine isn’t sexy enough anymore.
Archean is no longer just a marine chemical exporter;
