📌 At a Glance
Valiant Organics was once a specialty chemicals poster child — high margins, niche products, and a cult following. Fast forward to FY25: the company has posted net loss two years in a row, operating margins crashed from 30% to under 10%, and even the EPS went from “Wow!” to “Where is it?”
CMP ₹484 seems like a recovery, but underneath? Still radioactive.
🧬 About the Company
- Founded: 1984
- Listed On: BSE & NSE (BSE: 540145, NSE: VALIANTORG)
- Promoters: Gogri, Gala & Chedda families
- Business: Specialty Chemicals for dyes, pharma, pigments, agrochemicals
- Flagship Products: Chlorophenols, Anisidines, PAP, PNA, and others
🧑🔬 Key Product Segments
- Chlorination Line: PCP, OCP, 2,4 DCP — major input for agro, pharma, cosmetics
- Hydrogenation Line: Para/Ortho Anisidine, PAP — used in dyes and painkillers
- Ammonolysis Products: PNA, OCPNA — used in pigment intermediates
EduNote: If your high school chem lab smelled like sulphur and despair, these were probably the culprits.
📉 Financial Recap: FY21–FY25
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 574 | 948 | 912 | 677 | 719 |
| EBITDA (₹ Cr) | 157 | 165 | 130 | 40 | 54 |
| Net Profit (₹ Cr) | 115 | 103 | 76 | -3 | -3 |
| EPS (₹) | 42.20 | 37.91 | 27.83 | -1.10 | -1.07 |
| EBITDA Margin (%) | 27% | 17% | 14% | 6% | 7% |
| ROCE (%) | 27% | 18% | 12% | 1% | 3% |
| ROE (%) | 22% | 16% | 11% | 0% | -0.45% |
🔥 From Margin Machine to Margin Missing: In 5 years, revenue stagnated, profit vanished, and shareholders got a front-row seat to a vanishing act.
🧠 Compounded Growth Rates
| Metric | 5-Year CAGR |
|---|---|
| Revenue | 4% 😴 |
| Net Profit | NEGATIVE 📉 |
| Stock Price CAGR | -7% 📉 |
| Return on Equity (avg) | 3% 🧊 |
This isn’t a growth story. It’s an obituary in progress — unless there’s a miracle molecule around the corner.
💸 Balance Sheet Evolution
| Year | Net Worth (₹ Cr) | Borrowings (₹ Cr) | Fixed Assets (₹ Cr) | CWIP (₹ Cr) |
|---|---|---|---|---|
| FY21 | 502 | 150 | 478 | 46 |
| FY25 | 662 | 212 | 644 | 66 |
- Borrowing Binge: ₹53 Cr ➝ ₹212 Cr in 5 years
- Capex without Cashflow: Assets grew, profits didn’t
- ROCE Crash: 91% in FY19 ➝ 3% in FY25 — someone call the ICU 🚨
🩸 Cash Flow Snapshot
| Year | CFO (₹ Cr) | CFI (₹ Cr) | CFF (₹ Cr) | Net Flow |
|---|---|---|---|---|
| FY21 | ₹115 Cr | ₹-135 Cr | ₹22 Cr | ₹1 Cr |
| FY25 | ₹59 Cr | ₹-27 Cr | ₹-28 Cr | ₹4 Cr |
Company isn’t burning cash. But it sure isn’t minting it either. It’s just… existing.
🥊 Shareholding Breakdown (FY25)
| Category | FY23 | FY25 |
|---|---|---|
| Promoters | 38.41% ➝ 37.91% | |
| FIIs | 0.18% ➝ 0.37% | |
| DIIs | 0.89% ➝ 0.00% | |
| Public | 60.52% ➝ 61.72% |
📌 DIIs gave up. Retail is still holding on. Maybe they’re in too deep. Or maybe averaging down is the new religion.
🏭 Industry & Peer Benchmarking
| Company | P/E | ROCE % | Market Cap (Cr) |
|---|---|---|---|
| Valiant Organics | NA | 2.97% | ₹1,353 Cr |
| Deepak Nitrite | 38.4 | 16.6% | ₹26,761 Cr |
| Vinati Organics | 46.6 | 20.6% | ₹19,372 Cr |
| Atul | 43.4 | 12.7% | ₹20,984 Cr |
➡️ EduRoast: If specialty chemical stocks were students, Valiant is the one who forgot the exam date.
📉 Key Concerns
- 🚩 Negative EPS: Two years in a row
- 🔻 Margins collapsed: From 30% to single digits
- 🧾 Debtor Days & Inventory Up: Working capital pressure
- 🧯 Capex without Growth: ₹600 Cr invested but no top-line or bottom-line improvement
- 😳 Zero Dividend since FY23: Management switched to silent mode
🧮 Forward Fair Value Estimate
- Assumed EPS Recovery FY26: ₹10–15 (optimistic)
- Target P/E: 15 (industry trailing avg for beaten-down stocks)
- Fair Value Range: ₹150–₹225
- Current CMP: ₹484
- Verdict: Already up 100%+ from bottom, but might’ve run ahead of reality (or balance sheet).
🧠 EduInvesting Take
“Valiant” is a good name. Because only the valiant would still be holding this.
From ₹103 EPS (FY21) to losses in FY25 — this company gives a masterclass in how to mismanage growth and overbuild capacity. Unless the specialty chemicals cycle turns fast or they land a large export contract, this might remain a “value trap” dressed in “hope.”
Author: Prashant Marathe
Date: 12 June 2025
Tags: Valiant Organics, Specialty Chemicals, Chlorophenol, PAP, Hydrogenation, EduInvesting Recap, Balance Sheet Blowup, Loss-Making Stocks, NSE
