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Recently, we came across Vishnu Chemicals when running a screen to identify potential investment opportunities. The numbers looked interesting and we decided to dig deeper.
On reading more we found out that the company deals in Chromium and Barium compounds and is the largest manufacturer in India for both.
Below, we have shared the details from the Nov'22 presentation of the company. Hope you find them useful for your own research on the stock.
Recently, we released our New Stock Recommendation for Premium Members
It's a food processing company, virtually debt free, compounded profits at 20% + consistently, maintained returned ratios like ROE and ROCE at 20% +, doubled its market share in exports in its segment in the last 6-7 years and yet available at less than 7 times Pre-tax earnings.
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Vishnu Chemicals - Notes from Q2 FY 23 presentation
- Products include Chromium Compounds and Barium Compounds
- Long standing relationships with over 100 customers across Pharmaceuticals, Automobiles, Glass, Refractory, Ceramics, Tiles, Pigments & Dyes among others
- Leading position in the niche market with no domestic competitors in chromium business and unorganized competition in the Barium business with dominant market share
- Entry barriers due to complex 24/7 continuous manufacturing processes and extensive capital requirement
- 4 manufacturing units
- Visakhapatnam, Andhra Pradesh - Manufactures Chromium Chemicals
- Hyderabad, Telangana - Manufactures Chromium Chemicals
- Bhilai, Chhattisgarh - Manufactures Chromium Chemicals
- Srikalahasti, Andhra Pradesh - Manufactures Barium Chemicals
- Chromium Chemicals:
- Sodium Dichromate is a strong oxidizing agent and a source in preparing chromium based derivatives. It is used in metal passivation and finds applications across industries like pharmaceuticals, textiles, constructions to name a few
- Barium Chemicals:
- Other players have estimated capacity of less than 1/10th of Vishnu’s capacity
- Capacity expansion:
- 30 crore for Chromium division towards expansion of capacity from 70,000 tonnes to 80,000 tonnes. Production has started
- 90 crore for Barium division to introduce a new specialty chemical, Precipitated Barium Sulphate which is an import substitute with a great opportunity in India. Expected commencement of operations H1 FY 24
Disclaimer: This is not a recommendation to buy/sell Vishnu Chemicals. These notes are as announced by the companies on exchanges and only for the purpose of information and education.
SEBI Research Analyst Registration No. INH100001690
Research Analyst Details
Name: Ekansh Mittal Email Id: [email protected] Ph: +91 727 5050062
Details of Associate: Not Applicable
Analyst Certification: The Analyst certify (ies) that the views expressed herein accurately reflect his (their) personal view(s) about the subject security (ies) and issuer(s) and that no part of his (their) compensation was, is or will be directly or indirectly related to the specific recommendation(s) or views contained in this research report.
The views expressed are based solely on information available publicly and believed to be true. Investors are advised to independently evaluate the market conditions/risks involved before making any investment decision
This report is for the personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. Ekansh Mittal/Mittal Consulting/Katalyst Wealth is not soliciting any action based upon it. This report is not for public distribution and has been furnished to you solely for your information and should not be reproduced or redistributed to any other person in any form. This document is provided for assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. Ekansh Mittal or any of its affiliates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Neither Ekansh Mittal, nor its employees, agents nor representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information. Ekansh Mittal/Mittal Consulting or any of its affiliates or employees do not provide, at any time, any express or implied warranty of any kind, regarding any matter pertaining to this report, including without limitation the implied warranties of merchantability, fitness for a particular purpose, and non-infringement.
The recipients of this report should rely on their own investigations. Ekansh Mittal/Mittal Consulting and/or its affiliates and/or employees may have interests/ positions, financial or otherwise in the securities mentioned in this report. Mittal Consulting has incorporated adequate disclosures in this document. This should, however, not be treated as endorsement of the views expressed in the report.
We submit that no material disciplinary action has been taken on Ekansh Mittal by any regulatory authority impacting Equity Research Analysis.
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Whether the research analyst or research entity or his associate or his relative has any financial interest in the subject company/companies and the nature of such financial interest – No
Whether the research analyst or research entity or his associates or his relatives have actual/beneficial ownership of 1% or more securities of the subject company (at the end of the month immediately preceding the date of publication of the research report or date of the public appearance) – No
Whether the research analyst or research entity or his associate or his relative has any other material conflict of interest at the time of publication of the research report or at the time of public appearance – No
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