🟢 At a Glance
Sacheerome Ltd is a niche SME player crafting fragrances and flavours used across soaps, perfumes, food, incense sticks, and even your favorite biscuit. With 3-year PAT CAGR of 52%, ROCE near 39%, and operating margins expanding from 13% to 21% in 3 years, this ₹353 Cr microcap is now on the radar. But wait—promoters just dumped 28.5% stake. Smells like growth… or something fishy?
1. 🧼 Introduction with Hook
What do Surf Excel, Axe deodorant, and Parle-G all have in common?
No, not SRK ads — fragrance and flavour backends like Sacheerome, silently hacking your senses to make you want stuff.
🧠 It’s not a mass manufacturer. It’s a B2B scent-smith. They make:
- Flavours for food 🍊
- Fragrances for soaps, agarbattis, detergents, deodorants 🌸
- Scented inputs for home care, cosmetics, etc.
And now? It’s smelling profits.
2. 💼 Business Model – WTF Do They Even Do?
Sacheerome = Sachet + Aromas.
The company designs, manufactures, and customizes flavours & fragrances that go into:
- Processed food
- Personal care (soaps, shampoos, deo)
- Home care (phenyl, air fresheners)
- Agarbatti & incense
- Cosmetics & pharma
It operates in B2B mode, working with FMCG clients who need:
- Consistent scents for brand recall
- Import substitution (earlier, most Indian brands used European blends)
- Custom formulations (proprietary)
They’ve also expanded into in-house R&D and design, which creates IP-level stickiness.
Think of it as India’s smaller version of Givaudan (global scent giant).
3. 📈 Financials Overview – Profit, Margins, ROE, Growth
Let’s sniff out some numbers:
| Metric | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Sales | ₹64 Cr | ₹70 Cr | ₹85 Cr | ₹108 Cr |
| PAT | ₹5 Cr | ₹6 Cr | ₹11 Cr | ₹16 Cr |
| ROCE | – | 24% | 36% | 39% |
| Net Profit Margin | 8% | 8.6% | 13% | 14.8% |
| EPS | ₹11.1 | ₹14.7 | ₹6.5* | ₹9.8 |
(*FY24 EPS dip due to bonus issue: equity rose from ₹4 Cr to ₹16 Cr)
Key 🚨:
- PAT up 3x in 3 years
- Sales CAGR (3Y): ~19%
- PAT CAGR (3Y): 52%
- Margin expansion from 13% → 21% at OPM level
This ain’t no me-too chemical stock. It’s small, focused, and profitable.
4. 🧮 Valuation – Is It Cheap, Meh, or Crack?
- CMP: ₹158
- EPS (FY25): ₹9.78
- P/E: ~16.2x
- ROCE: 39%
- ROE: 30%
- Market Cap: ₹353 Cr
Let’s do some fair value math.
Assume FY26 EPS = ₹12 (20% growth), assign 18–24x:
🔎 FV Range = ₹216 to ₹288
(EPS ₹12 × P/E 18–24)
At ₹158, it’s trading below fair zone. Smells slightly undervalued — unless promoter selling was a deodorant moment to mask something deeper.
5. 🔥 What’s Cooking – News, Triggers, Drama
- 🧴 Fragrance/flavour demand exploding with Indian FMCG + exports
- 🏭 ₹28 Cr CWIP = major capex → 3x jump in WIP since FY23
- 🧠 In-house R&D and formulation labs = margin moat
- 😳 Promoter stake dropped 28.5% last quarter (WTH?)
This is the scent of:
- Business scaling up (positive)
- Promoters cashing out (confusing)
- Institutional buying (DIIs up to 12.8%)
Next 2–3 quarters will show if they’re bottling value or just venting gas.
6. 🧾 Balance Sheet – How Much Debt, How Many Dreams?
| Metric | FY25 |
|---|---|
| Equity Capital | ₹16 Cr |
| Reserves | ₹46 Cr |
| Total Debt | ₹3 Cr |
| Total Assets | ₹85 Cr |
| CWIP | ₹28 Cr |
| Debt/Equity | 0.06 ✅ |
Zero leverage problems. Healthy reserves, and capex already funded via internal accruals + minimal borrowing.
That’s SME discipline. Or a CFO with PTSD from 2008.
7. 💸 Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY22 | ₹9 Cr | -₹4 Cr | -₹6 Cr | -₹1 Cr |
| FY23 | ₹11 Cr | -₹2 Cr | -₹9 Cr | ₹0 Cr |
| FY24 | ₹10 Cr | -₹10 Cr | ₹1 Cr | ₹1 Cr |
| FY25 | ₹22 Cr | -₹23 Cr | ₹2 Cr | ₹1 Cr |
Key points:
- CFO grew 2.4x in 3 years
- Capex-heavy (₹23 Cr in FY25) = big future setup
- No cash burn — net cash flow is stable positive
Strong capex without chaos = next-level margin compounding possible.
8. 📊 Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 38.6% ✅ |
| ROE | 29.6% ✅ |
| OPM | 21% ✅ |
| EPS | ₹9.78 ✅ |
| Working Capital Days | 36 ✅ |
| Cash Conversion Cycle | 35 ✅ |
| Dividend | 0% ❌ |
Fragrance stock with FMCG-style metrics.
But where’s the perfume-scented dividend? 🧴👀
9. 🧾 P&L Breakdown – Show Me the Money
| FY25 | Value |
|---|---|
| Revenue | ₹108 Cr |
| EBITDA | ₹23 Cr |
| PAT | ₹16 Cr |
| Net Margin | 14.8% |
| EPS | ₹9.78 |
| Dividend | ₹0 |
What stands out:
- Clean EBITDA
- Zero interest drag
- High-margin, low-churn B2B setup
10. ⚔️ Peer Comparison – Who Else in the Game?
| Company | P/E | ROCE | ROE | OPM |
|---|---|---|---|---|
| Sacheerome | 22.1 | 38.6% | 29.6% | 21% |
| Vinati Organics | 48.8 | 20.6% | 15.7% | 26% |
| Deepak Nitrite | 38.4 | 16.6% | 13.7% | 13% |
| Navin Fluorine | 84.1 | 11.7% | 11.5% | 22.7% |
| Pidilite | 73.9 | 29.9% | 23.1% | 22.9% |
Sacheerome wipes the floor on ROCE & ROE.
Even giants like Pidilite and Vinati can’t boast this combo at 22x P/E.
Underrated? Definitely.
Unknown? For now.
11. 🧠 Miscellaneous – Shareholding, Promoters
| Category | % (Jun 2025) |
|---|---|
| Promoters | 71.54% ✅ |
| FIIs | 1.46% |
| DIIs | 12.81% 🚨 (up from 0!) |
| Public | 14.19% |
🚨 Promoter stake fell 28.5% in a quarter. No formal explanation.
But DIIs seem to have picked it up — which could mean:
- Secondary block deal?
- Pre-IPO investors exiting?
- Or just a family cashout?
Need to watch if this trend continues or stabilizes.
12. 🧼 EduInvesting Verdict™
Sacheerome is not your average SME chemical play.
This one’s fragrant, focused, and filthy profitable.
✅ Niche, sticky B2B model
✅ High ROCE, high margins
✅ Low WC cycle
✅ Strong cash flow + big capex
But…
❌ Promoter selling is a red flag until clarified
❌ No dividend
❌ Still under-covered and illiquid
At 22x P/E, it’s not cheap. But compared to its fat-margin chemical cousins, it’s still undervalued.
🎯 Fair Value Range: ₹216–₹288
This one could compound quietly.
Unless the promoters pull a “yeh sab to fragrance business tha, real deal to real estate hai”.
✍️ Written by Prashant | 📅 July 2, 2025
Tags: Sacheerome Ltd, Fragrance Stocks, SME IPO, Chemical Flavour Business, High ROCE India, EduInvesting, D2C FMCG Ingredients, Capex SME Play
