1. At a Glance
Rossari Biotech is India’s low-key, high-impact specialty chemicals play—servicing textiles, home care, and animal nutrition. With 13% OPM, ₹2,134 Cr TTM revenue, and a Saudi expansion plan, it’s trying to go global… while its ROE quietly sips chai at 12.2%.
2. Introduction with Hook
If chemicals had a Tinder profile, Rossari would be the “smart, stable, and future-focused” match. It may not swipe you off your feet instantly, but it’s quietly building a moat in niche chemicals.
- EPS (TTM): ₹24.41
- OPM: 13% (consistently stable across quarters)
- Saudi & Dahej expansions in motion
- But… PAT growth in FY25? Just +3.7%. Hmm.
So, are we dealing with a compounder-in-the-making or a PE-rich slow burn?
3. Business Model (WTF Do They Even Do?)
Rossari Biotech operates across three verticals:
- Home, Personal Care & Performance Chemicals (HPPC)
- Cleaning, disinfection, preservation
- Clients: FMCG, pharma, food processing
- Textile Specialty Chemicals
- Pretreatment, dyeing, finishing—used by top Indian textile giants
- Animal Health & Nutrition
- Probiotics, feed additives—benefitting from India’s animal protein push
Bonus Points:
- 4,280+ SKUs
- Two R&D centers (Silvassa + IIT Bombay)
- 4 manufacturing plants (Dahej, Silvassa, and two from Unitop + Tristar acquisition)
4. Financials Overview
| Metric | FY23 | FY24 | FY25 | TTM |
|---|---|---|---|---|
| Revenue (Cr) | ₹1,656 | ₹1,831 | ₹2,080 | ₹2,134 |
| EBITDA (Cr) | ₹223 | ₹250 | ₹265 | ₹268 |
| Net Profit (Cr) | ₹107 | ₹131 | ₹136 | ₹135 |
| OPM (%) | 13% | 14% | 13% | 13% |
| EPS (₹) | ₹19.45 | ₹23.66 | ₹24.63 | ₹24.41 |
Verdict:
Steady, non-volatile operator. No boom-bust cycles here—but also not a rocket ship.
5. Valuation
Fair Value Estimate Range (FY26 Projections):
| Method | Basis | FV Range (₹) |
|---|---|---|
| P/E Based | 32x FY26E EPS of ₹27 | ₹790 – ₹860 |
| DCF Based | 11% discount, 10% growth CAGR | ₹720 – ₹750 |
| EV/EBITDA | 20x FY26 EBITDA | ₹780 – ₹820 |
Current Price: ₹743
Fair Value Range: ₹720 – ₹860
Is it undervalued? Nope. Is it nosebleed high? Also nope.
6. What’s Cooking – News, Triggers, Drama
- New Saudi Subsidiary: Local manufacturing in GCC = margin upside
- ₹95 Cr CAPEX approved for FY26
- Dahej land allotment = next-gen production boost
- Launch of Renewable Biosurfactants Platform
- ESOPs & Dividend Announced: Final 25% for FY25
- Unistar Thai Acquisition Completed: Footprint in Southeast Asia
Drama-free, but growth-fueled.
7. Balance Sheet
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | ₹11 Cr | ₹11 Cr | ₹11 Cr |
| Reserves | ₹904 Cr | ₹1,037 Cr | ₹1,174 Cr |
| Borrowings | ₹74 Cr | ₹119 Cr | ₹218 Cr |
| Total Assets | ₹1,364 Cr | ₹1,567 Cr | ₹1,886 Cr |
Key Points:
- Debt doubling? Yes—but still D/E < 0.2
- Healthy reserves = internal funding for expansions
- Not capital-light, but capital-smart
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Flow |
|---|---|---|---|---|
| FY23 | ₹152 Cr | -₹181 Cr | ₹61 Cr | ₹32 Cr |
| FY24 | ₹43 Cr | -₹103 Cr | ₹16 Cr | -₹44 Cr |
| FY25 | ₹137 Cr | -₹183 Cr | ₹65 Cr | ₹19 Cr |
Insights:
- Investing aggressively (Dahej, Saudi, etc.)
- Healthy CFO rebound in FY25
- Not hoarding cash = growth-focused
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE (%) | 18% | 18% | 16% |
| ROE (%) | 19.4% | 23.6% | 24.6% |
| Debtor Days | 78 | 85 | 83 |
| Inventory Days | 59 | 80 | 90 |
| CCC (Days) | 80 | 103 | 101 |
Stress Point: Working capital cycle creeping toward triple digits.
10. P&L Breakdown – Show Me the Money
| Metric | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Revenue | ₹1,483 Cr | ₹1,656 Cr | ₹1,831 Cr | ₹2,080 Cr |
| EBITDA | ₹184 Cr | ₹223 Cr | ₹250 Cr | ₹265 Cr |
| PAT | ₹98 Cr | ₹107 Cr | ₹131 Cr | ₹136 Cr |
| EPS (₹) | ₹17.74 | ₹19.45 | ₹23.66 | ₹24.63 |
Key Signal: Profits are growing, but slowly. EPS grew just ~4% in FY25.
11. Peer Comparison
| Company | CMP (₹) | P/E | ROE (%) | OPM (%) | MCap (₹ Cr) |
|---|---|---|---|---|---|
| Pidilite | 2,958 | 71.8 | 23.1 | 22.9 | 1,50,469 |
| Deepak Nitrite | 1,949 | 38.1 | 13.7 | 13.1 | 26,581 |
| Navin Fluoro | 4,869 | 86.4 | 11.5 | 22.7 | 24,930 |
| Atul Ltd | 6,942 | 40.9 | 9.1 | 16.1 | 20,437 |
| Rossari | 743 | 30.5 | 12.2 | 13.0 | 4,115 |
Translation:
Among mid-sized players, Rossari has one of the lowest P/Es. But also… lower growth momentum.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: Stable at 68.18%
- FIIs: Down from 8.8% to 3.5% in 2 years—exiting cautiously
- DIIs: Steady hand, holding ~18%
- Public: Now over 10.5%
Also…
- 834,250 ESOPs granted
- Final dividend: 25% (not very generous, but it’s something)
- Acquired Unistar Thai + forming new Saudi arm
13. EduInvesting Verdict™
Rossari is not your get-rich-quick pick. But it’s building a boring-but-beautiful compounder story in specialty chemicals. With clean corporate governance, strategic global moves (Saudi, Thailand), and 4,000+ products, it’s well-placed in a fragmented space.
Yes, PAT growth is plateauing, and working capital is stretching.
But margins are steady, and EPS is creeping up.
Translation for investors: This isn’t a party stock. It’s a pension stock.
If you like slow-cooked biryani instead of popcorn, Rossari may be your jam.
Metadata
– Written by EduInvesting Research | July 20, 2025
– Tags: Rossari Biotech, Specialty Chemicals, Q1 FY26, Saudi Expansion, Sustainable Surfactants, EPS Growth
