1. At a Glance
Tatva Chintan’s Q1 FY26 was less “Breaking Bad” and more “Breaking Balance Sheet.” With ROCE barely twitching at 1.16%, and stock P/E hallucinating at 331x, this specialty chemicals player is pricing in Nobel Prize-winning growth… that hasn’t shown up yet. CFO’s resignation didn’t help calm investor nerves either.
2. Introduction with Hook
Imagine buying a Ferrari, paying Rolls Royce prices, and getting Maruti 800 mileage. That’s Tatva Chintan for you in Q1 FY26. A stock that once symbolized premium specialty chemical innovation is now struggling to post double-digit margins, while investors stare at their screens wondering if Excel is broken.
Two stats to kick you in the gut:
- Stock P/E: 331.59. Yes, that’s not a typo.
- TTM Net Profit: ₹7 Cr. That’s not a tech glitch either.
3. Business Model (WTF Do They Even Do?)
Tatva Chintan makes molecules that sound like Marvel villains: Structure Directing Agents, Phase Transfer Catalysts, and Electrolyte Salts. Basically, they make ingredients that make other stuff work better—like Red Bull for industrial chemistry.
They also make pharma and agro intermediates. So, their products help make drugs that help people, and crops that feed people. Except, the only thing not growing right now is their own topline.
4. Financials Overview
Let’s talk numbers, and yes, you’ll need tissues:
| Metric | Q1 FY25 | Q1 FY26 | YoY Growth |
|---|---|---|---|
| Revenue | ₹107.86 Cr | ₹116.86 Cr | 8.3% |
| EBITDA | ₹8.96 Cr | ₹17.32 Cr | +93% |
| EBITDA Margin | 8.3% | 14.8% | Almost decent |
| Net Profit | ₹1.03 Cr | ₹6.65 Cr | +546% |
| PAT Margin | 0.95% | 5.7% | Okay-ish |
Sounds good until you realize: a ₹2,374 Cr company made just ₹6.65 Cr profit. Which is like owning a Mercedes and leasing it to Uber for pocket change.
5. Valuation
Let’s run this circus through two lenses:
a) P/E Valuation:
- EPS TTM = ₹3.06
- Industry P/E (Median) ~35x
- Fair Value (P/E based) = 3.06 x 35 = ₹107
b) EV/EBITDA Valuation:
- EBITDA TTM ~ ₹39 Cr
- EV/EBITDA industry average = 18x
- Enterprise Value = 18 x 39 = ₹702 Cr
- Add Cash, Subtract Debt
- Fair Value (EV/EBITDA based) = ~₹135–₹160**
Reality Check: CMP is ₹1,015. If you’re still holding, you may also believe in unicorns and NDTV business news projections.
6. What’s Cooking – News, Triggers, Drama
- CFO Resigned: Always a red flag when the guy controlling the purse walks out.
- New Plants?: Capex was heavy earlier, but production ramp-up still hasn’t clicked.
- Export Demand: Global agro & pharma cycles may revive demand, but no signs yet.
- China+1 theme: Still hanging around like the ghost of Diwali past.
Plot twist level: Mild. Feels more like a bad web series than a blockbuster Q1.
7. Balance Sheet
| Item | FY25 | Comment |
|---|---|---|
| Total Assets | ₹836 Cr | Up, thanks to Capex bloat |
| Reserves | ₹715 Cr | Silent but stable |
| Borrowings | ₹36 Cr | Down from ₹170 Cr in FY23 |
| Net Worth | ₹738 Cr | Still solid |
Debt isn’t Titanic-level. But revenue’s barely paddling.
8. Cash Flow – Sab Number Game Hai
| Year | CFO (₹ Cr) | CFI (₹ Cr) | CFF (₹ Cr) | Net Cash |
|---|---|---|---|---|
| FY23 | ₹28 | ₹-101 | ₹38 | ₹-36 |
| FY24 | ₹98 | ₹-121 | ₹31 | ₹8 |
| FY25 | ₹25 | ₹-65 | ₹17 | ₹-24 |
Cash flow is like a freelancer’s bank account—erratic, confusing, and mostly empty when you need it.
9. Ratios – Sexy or Stressy?
| Ratio | Value | Verdict |
|---|---|---|
| ROCE | 1.16% | Cold coffee level |
| ROE | 0.77% | Sleeping stock |
| PAT Margin | 1.8% | We’ve seen better on UPI tips |
| P/E | 332x | LOL. |
| D/E | 0.05 | Good. At least one green light. |
If ratios were Tinder profiles, Tatva Chintan’s would get ghosted.
10. P&L Breakdown – Show Me the Money
| Year | Revenue (₹ Cr) | EBITDA (₹ Cr) | PAT (₹ Cr) |
|---|---|---|---|
| FY23 | ₹424 | ₹61 | ₹45 |
| FY24 | ₹394 | ₹69 | ₹30 |
| FY25 | ₹383 | ₹34 | ₹6 |
“Growth” has officially left the chat.
11. Peer Comparison
| Company | Rev (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Deepak Nitrite | 8281 | 697 | 37.6x |
| Vinati Organics | 2248 | 415 | 47.4x |
| Navin Fluorine | 2349 | 288 | 90.1x |
| Tatva Chintan | 394 | 7 | 331.6x |
This is like comparing a packet of Kurkure to a buffet at Taj.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2023 | Jun 2025 |
|---|---|---|
| Promoters | 79.17% | 72.02% |
| FIIs | 3.59% | 3.26% |
| DIIs | 11.17% | 5.11% |
| Public | 6.08% | 19.6% |
Promoters are tiptoeing out, and DIIs have hit the snooze button. Public holding tripled—probably retail caught in the “chemical multibagger” dream.
13. EduInvesting Verdict™
Tatva Chintan looks like a company that overpromised, overspent, and now hopes we forget the hype. It has niche products and a clean balance sheet, but revenue stagnation and abysmal profitability raise serious questions.
A decent pit stop for chemistry nerds. But don’t expect business class legroom.
Metadata:
Written by EduInvesting Team | 24 July 2025
Tags: Tatva Chintan, Specialty Chemicals, Analysis, EduInvesting Premium
