🧪 At a Glance
Camlin Fine Sciences Ltd (NSE: CAMLINFINE) — a specialty chemicals maker once known for antioxidants and vanillin dreams — has had a chemically unstable past five years. After a profit cliff dive, rising debt, and vanillin volatility, the stock is up 182% in one year, but its fundamentals are still playing hide-and-seek. ROCE is back to 10%, but P/E is 127. Do we smell a turnaround… or just evaporated optimism?
🧬 About the Company
- Core products: Specialty chemicals, antioxidants, vanillin, custom blends
- Operates across food preservation, pet nutrition, pharma, and perfumery
- Global presence with units in Italy, Mexico, Brazil, and India
- Key verticals: Aroma Ingredients, Performance Chemicals, Shelf-life Solutions
Camlin Fine started as a science fair project that got too big — and now it smells like vanilla and balance sheet stress.
👔 Key Managerial Personnel
- Ashish Dandekar – Managing Director (also a promoter; perhaps more optimistic than objective)
- Ramesh Krishnan – CFO
- Kanchan Gore – Company Secretary
Their investor calls often sound like chemistry lectures mixed with startup optimism.
📊 Financial Recap (FY21–FY25)
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 1,187 | 1,412 | 1,682 | 1,613 | 1,667 |
| EBITDA (₹ Cr) | 187 | 158 | 213 | 84 | 208 |
| Net Profit (₹ Cr) | 65 | 60 | 40 | -105 | -158 |
| EPS (₹) | 3.56 | 3.45 | 2.96 | -4.94 | -7.40 |
| OPM % | 16% | 11% | 13% | 5% | 12% |
| ROCE % | 13% | 10% | 10% | 1% | 10% |
🧂Flavour of the Year: FY24 was bitter — losses widened due to abnormal other income hit (₹–202 Cr), poor volumes, and erratic global markets.
🧮 Fair Value Estimate (2026–27)
Using a generous 15x forward EBITDA and an FY27E EBITDA assumption of ₹250 Cr (assuming a full turnaround in vanillin + blend business):
- Fair Value Range: ₹160–₹200
- CMP is ₹302, so it’s already trading 50–90% above any realistic optimism.
- P/E of 127 screams “premium vanilla pricing” — but the earnings are more like sugar-free.
📈 Why It Stands Out
- Stock up 182% in 1 year despite 2 consecutive years of losses
- Promoter stake increased to 49.09%
- Global aroma & antioxidant demand rising
- Massive vanillin capacity expansion (45–50% utilization reached)
- Inventory cycle improving (CCC now 136 days vs 192 last year)
Translation: Hype smells like growth. But taste the cash flows — they’re thin.
🏗️ What Changed in 5 Years?
Then (FY21):
- OPM: 16%
- Profitable across regions
- Promoter holding: ~17%
Now (FY25):
- OPM: 12%, volatile
- Net loss: ₹158 Cr
- Promoter holding: 49% – a good sign if they know something we don’t
🧾 Balance Sheet Snapshot (FY25)
| Item | Value (₹ Cr) |
|---|---|
| Net Worth | ~₹902 |
| Borrowings | ₹681 Cr (flat YoY) |
| Cash Flow from Ops | ₹27 Cr (down 80% YoY) |
| Net Block | ₹714 Cr |
| CWIP | ₹10 Cr |
| Investments | ₹61 Cr |
| Debt/Equity | ~0.75x |
| Interest Coverage | Barely above 1x — red zone! |
The debt isn’t a bomb, but the fuse is short if margins collapse again.
🔍 Segment Performance Highlights
1. Vanillin & Aroma Division
- Global expansion in aroma molecule synthesis
- FY25 capacity utilization at 45–50%
- Exports remain key, especially EU and LatAm markets
2. Antioxidants for Pet Nutrition & Human Foods
- US/Canada markets improving
- EBITDA margin here is better than core chemicals
3. Discontinued Operations
- Legacy businesses with low RoI have been officially abandoned
They finally Marie-Kondo’d their portfolio: if it didn’t spark margin joy, it’s gone.
🧠 EduInvesting Take
Camlin Fine is trying to rebrand from a commodity chem player to a global aroma brand. There’s actual potential. But let’s be honest:
- Earnings are erratic
- Other income volatility has caused P&L disasters
- Capex is mostly done, but return on that is TBD
- ROCE and ROE still struggle to cross 10% mark
Is it a turnaround?
Maybe. But right now, it’s a ₹5,600 Cr company with a ₹0.11 Cr net profit. That’s 50,000x earnings. 👀
⚠️ Risks & Red Flags
- Insane P/E of 127 — don’t try to justify it with DCF dreams
- Interest cost rising (₹100 Cr now) with low coverage
- Global pricing pressures in vanillin, high competition from China
- Raw material volatility in solvents, benzene, etc.
🔮 Outlook
- FY26 might see normalization of profits — if OPM holds 12–13% and EBITDA hits ₹250 Cr, PAT could be ₹100 Cr+
- Global demand for clean-label aroma & antioxidants is rising
- Long-term India consumption tailwinds + export tailwinds = optionality
🏁 TL;DR
Camlin Fine = Vanilla Scent, Bitter Aftertaste.
Promoters are buying, stock is flying, but earnings are barely crawling. If they execute the next 2 years flawlessly, it could justify the price. If not — this is chemistry without balance.
Author: Prashant Marathe
Date: 13 June 2025
Tags: Camlin Fine Sciences, specialty chemicals, vanillin, FY25 results, P/E 127, EduInvesting recap, turnaround stock, promoter buying, balance sheet analysis, ROCE
