🟡 At a Glance
Navin Fluorine is one of India’s most respected specialty chemical players, focusing on fluorinated molecules across pharma, refrigeration, and agrochemicals. But despite a ₹23,000 Cr market cap and 20% profit CAGR over 10 years, it’s trading at a P/E of 80 while growth slows. Are investors inhaling too much fluorine?
1. 🧪 The Business: Fluorine, But Make It Fancy
Navin Fluorine International Ltd (NFIL) isn’t just another chemical stock.
- It manufactures over 60+ specialty fluorinated compounds
- Key verticals:
- Refrigerants (legacy)
- Inorganic fluorides
- Specialty Organofluorines (high-margin)
- CRAMS (Contract Research & Mfg Services)
- Clients: Global pharma, agrochemical giants
- Promoter: Vishad Mafatlal (Padmanabh Mafatlal Group)
This isn’t the kind of company that sells bleach and detergent. It makes molecules that go into cancer drugs, agrochemicals, even semiconductors.
2. 📈 The 5-Year Financial Recap: From Sizzling to Simmering
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (Cr) | 1,179 | 1,453 | 2,077 | 2,065 | 2,349 |
| EBITDA (Cr) | 309 | 356 | 550 | 399 | 534 |
| EBITDA % | 26% | 24% | 26% | 19% | 23% |
| PAT (Cr) | 258 | 263 | 375 | 270 | 289 |
| EPS (Rs) | 52 | 53 | 76 | 55 | 58 |
Key Observations:
- Revenue nearly doubled from FY21 to FY25
- EBITDA margins dipped sharply in FY24 but recovered in FY25
- PAT growth has slowed down post-FY23
In short: Growth hai, par dhamaka gaya.
3. 💸 Capex, CWIP & Borrowings: The Real Chemistry
- CWIP ballooned to ₹711 Cr in FY24, now at ₹350 Cr – indicates heavy recent commissioning
- Borrowings surged from ₹121 Cr in FY22 to ₹1,466 Cr in FY25
- Net cash flow from operations: ₹571 Cr in FY25 (strong)
So NFIL has taken the “debt for growth” route. High capex is mostly toward HPP (High Performance Products) and MPP (Multi-Purpose Plant).
But investors are asking: “Where are the returns, bro?”
4. 🧾 Valuation: Growth Stock, Value Nahi
| Valuation Metric | Value |
|---|---|
| CMP | ₹4,685 |
| Market Cap | ₹23,200 Cr |
| TTM P/E | 80x |
| P/B | 8.8x |
| Dividend Yield | 0.26% |
| ROCE | 12% |
| ROE | 11.5% |
🚨 Red Flags:
- ROE & ROCE are barely beating debt cost
- Trading at 3x sales and 80x earnings with single-digit profit growth
- Market’s clearly pricing in future optionality, not present earnings
5. 🏭 Segment Performance & Growth Triggers
- Refrigerants: Stable, but low-margin legacy segment
- Specialty chemicals (HPP & MPP): Growth engine, now operational
- CRAMS (CDMO): Growing due to global outsourcing
- Strategic capex completed for fluorinated agro & pharma intermediates
- Global tailwinds from China+1 and API localization
BUT…
Execution is everything. And last two years saw tepid results. Markets have moved from “hope” to “proof chahiye.”
6. 🧠 Management & Shareholding
- CEO: Vishad Mafatlal (2nd-gen promoter)
- Promoter stake: 28.43%
- FIIs + DIIs own over 50% of the company
- Retail public: just 21%
Institutional investors still believe. Question is, how long?
7. 🧮 Fair Value Estimate (FV Range)
Let’s be realistic. Given:
- FY25 EPS: ₹58
- 5-Year EPS CAGR: ~2% (recent slowdown)
- P/E band: 40x (low), 60x (fair), 80x (premium)
| Case | EPS | P/E | FV |
|---|---|---|---|
| Conservative | ₹60 | 40x | ₹2,400 |
| Moderate | ₹65 | 50x | ₹3,250 |
| Optimistic | ₹70 | 60x | ₹4,200 |
🔵 EduInvesting FV Range: ₹2,400 – ₹4,200
At ₹4,685 today, the stock is already baking in best-case assumptions.
TL;DR: Fluoro ka Fever, Ya Valuation ka Bukhar?
- Navin Fluorine is a high-quality company with long-term tailwinds
- But recent earnings momentum is weak, and stock is priced like it’s Tesla of chemicals
- Heavy capex + low ROE = warning signs
- Holding long term? Maybe. Entering now? Better value exists elsewhere
✍️ Written by Prashant | 🗓️ 21 June 2025
Tags: Navin Fluorine, specialty chemicals, fluorochemicals, Vishad Mafatlal, chemical stock analysis, EduInvesting, 5-year recap, high P/E stocks, CDMO, India China+1, fluorine sector
