Tatva Chintan's Q2 revenue grew 75.9% YoY, supported by solid performance across segments, particularly structure directing agents. Ebitda margin held at 18.7%, weighed down by rising solvent cost from supply shortages and steep freight charges. The company expects margin headwinds to gradually normalise from Q3 FY27. The company continues to see growth opportunities across segments, with semiconductor chemicals emerging as a potential long-term growth driver. Work on the company's new greenfield facility is progressing as planned, providing visibility for medium-term growth. ICICI Securities raises FY27E/FY28E Ebitda by 4–8%, and change its valuation methodology to EV/Ebitda (earlier P/E multiple) and roll over valuations to Sep'28E.
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ICICI Securities Report
Following Tatva Chintan Pharma Chem Ltd.'s strong September-quarter results, ICICI Securities has maintained its 'Buy' rating and has revised it target price to 2,385 from earlier Rs 1,955, implying a potential upside of 25% from the reports current market price, valuing at 25 times Ebitda.
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The brokerage highlighted that Q2 FY27 print sustained its strong Ebitda uptick, expanding 26% QoQ/83.3% YoY to Rs 40.7 crore.
Revenue grew 75.9% YoY, supported by solid performance across segments, particularly SDA. Ebitda margin held at 18.7%, weighed down by rising solvent cost from supply shortages and steep freight charges.
Tatva Chintan expects margin headwinds to gradually normalise from Q3 FY27. The company continues to see growth opportunities across segments, with semiconductor chemicals emerging as a potential long-term growth driver.
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Work on the company's new greenfield facility is progressing as planned, providing visibility for medium-term growth. ICICI Securities raises FY27E/FY28E Ebitda by 4–8%, and change its valuation methodology to EV/Ebitda (earlier P/E multiple) and roll over valuations to Sep'28E.
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