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Nirmal Bang Report
Camlin Fine Sciences Ltd.'s overall Q4 FY24 earnings performance came significantly below our and consensus estimates. Ebitda loss of Rs 133 million came on the back of demand pressure in the ex-Blends portfolio and pricing erosion (inventory write down of Rs 368 million).
Vanillin, one of the major earnings driver for Camlin Fine, has been facing significant pricing pressure due to increased competition from China.
Catechol prices have also fallen further. Blends business has been the clear outperformer for Camlin Fine which was up ~43% YoY in Q4 FY24 and FY24.
Camlin Fine's earnings and return ratios can improve only if the overall pricing scenario improves and the company executes well on Vanillin, potential MPP at Italy.
Maintain Buy with a revised target price of Rs 130 (15 times price-to-earning on FY26E.
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