At a Glance

Navin Fluorine International Ltd (NFIL) posted a scorching Q1 FY26 with profit jumping 129% YoY to ₹117 Cr and revenue at ₹739 Cr (+39% YoY). Margins expanded to 29% and order books remain hot. Yet, the stock at ₹5,190 trades at a stratospheric P/E 75 – investors are pricing in not just growth but superhero powers. Add a QIP of ₹750 Cr and promoter stake dipping to 27.1%, and you’ve got a cocktail of growth and governance questions.

Introduction

Founded in 1967, NFIL has evolved from a refrigerant gas supplier to a specialty chemicals powerhouse. It makes 60+ fluorinated compounds serving pharma, agro, aluminium, and refrigeration sectors. This quarter? Explosive profit growth. But with the stock already priced like it manufactures unicorn dust, the big question is: how much of this growth is sustainable?

Business Model (WTF Do They Even Do?)

NFIL operates across four verticals:

1. Refrigeration Gases – legacy but stable.
2. Inorganic Fluorides – industrial applications.
3. Specialty Organofluorines – high-margin pharma/agro inputs.
4. CRAMS (Contract Research & Manufacturing Services) – custom molecules for global pharma/chem giants.

The moat lies in tech know-how and long-term contracts. Risks? Regulatory changes, raw material costs, and concentration in exports.

Financials Overview

Q1 FY26 Snapshot:

• Revenue: ₹739 Cr (+39% YoY, +5% QoQ)
• Operating Profit: ₹207 Cr (OPM 29%)
• Net Profit: ₹117 Cr (+129% YoY, +23% QoQ)
• EPS: ₹23.6

Annual FY25 saw revenue ₹2,349 Cr and PAT ₹289 Cr (+7%). TTM growth exploded 62% thanks to this quarter’s jump.

Valuation

1. P/E Method

• EPS FY25: ₹58.2
• Industry P/E: 35
• Fair Value = 58.2 × 35 = ₹2,037

2. EV/EBITDA

• EBITDA FY25: ₹534 Cr
• Multiple: 15×
• EV ≈ ₹8,000 Cr → per share ≈ ₹2,500

3. DCF (20% growth, 10% discount)

• Range: ₹3,500 – ₹4,200

Current ₹5,190 → priced for perfection (and then some).

What’s Cooking – News, Triggers, Drama

• QIP ₹750 Cr at ₹4,680/share – equity dilution, but cash for expansion.
• Strong CRAMS demand driving margins.
• Promoter stake falls – from 28% to 27.1%.
• Capex on track for specialty chemical facilities.

Balance Sheet

Commentary: Strong equity, rising borrowings – capex heavy phase.

Cash Flow – Sab Number Game Hai

Commentary: Ops cash healthy, investing aggressive – growth mode ON.

Ratios – Sexy or Stressy?

Commentary: Margins sexy, returns mediocre due to capex-heavy structure.

P&L Breakdown – Show Me the Money

Commentary: FY24 was a dip year; Q1 FY26 signals revival.

Peer Comparison

Commentary: NFIL trades at premium even vs peers.

Miscellaneous – Shareholding, Promoters

• Promoters: 27.1% (falling)
• FIIs: 21.9% (rising)
• DIIs: 29.9% (stable)
• Public: 21.0%

Institutions are loading, promoters slowly offloading.

EduInvesting Verdict™

NFIL Q1 FY26 was a chemical cocktail of growth – triple-digit profit surge, margin expansion, and strong CRAMS traction. Yet, at P/E 75, the market is assuming endless fluorine magic. Any slip in execution, raw material spikes, or global demand slowdown, and valuations could get corroded.

Past Performance

• From legacy refrigerants to a global specialty chemicals name.
• Profit growth inconsistent, but Q1 shows a comeback.

Headwinds

• High valuations.
• Promoter stake dilution.
• Regulatory and raw material risks.

SWOT

Strengths: Tech edge, diversified fluorine portfolio, export growth.
Weaknesses: Low ROE, heavy capex.
Opportunities: CRAMS expansion, high-value molecules.
Threats: Competition, price volatility, ESG pressures.

Final Word

Navin Fluorine is like that high-end lab chemical – potent, valuable, but expensive. Q1 FY26 confirms growth revival, but with the stock trading at sky-high multiples, investors must ask: are they buying growth or just inhaling fumes?

Written by EduInvesting Team | 30 July 2025
SEO Tags: Navin Fluorine, Specialty Chemicals, Q1 FY26 Results, Stock Analysis