Tatva Chintan Pharma Chem Limited shares made a splendid debut in the market on Thursday, opening on July 29 at a premium of nearly 100 percent over the market price. The stock debuted at Rs 2,111.85 on the National Stock Exchange (NSE), a 95 percent premium to its issue price of ¥ 1,083 apiece. On the Bombay Stock Exchange (BSE), the stock was listed at Rs 2,111.80, an increase of over 95 percent. The highly anticipated stock climbed 130 percent to Rs 2,486 minutes after it traded.
After doubling investor wealth, the stock traded at Rs 2,281.9 at 1300 IST on July 29, more than 110% above its issue price. With an increase of over 100 percent on the stock market, Tatva Chintan Pharma Chem’s shares were the second share to double investor money in July.
“Due to the healthy margin profile, the strong focus on research and development, the promising industry outlook and the long-term relationship with key customers, we received a ‘Subscribe’ rating when we went public. The price was rated on the basis of FY21 with a premium rating of 46x P / E, which offered scope for profits that are still at discounts compared to industry colleagues and with a positive outlook. Owning it is good business in the long run, but at this staggering level, the CMP is tight at 98x P / E, in the short to medium term investors may consider adding profits or adding during the correction, “Vinod said Nair, Head of Research at Geojit Financial Services.
“Tatva Chintan Pharma Chem, one of the world’s leading manufacturers of specialty chemicals, made an outstanding debut on the stock exchanges today with a premium of 95% to 2,112 rupees / share compared to the issue price of 1,083 rupees / share. It continued to rebound towards its intraday high of Rs 2,486, gaining 130%. The company saw a very strong draw of 180x, with the retail segment drawn 35x, the QIB segment 185x while the non-institutional segment attracted 512x. After Clean Science, TCPCL is the second company in the green chemistry sector to be listed on the stock exchange. It is the only manufacturer in India and one of the largest in the world for some of its products. Its products have various uses in green chemistry, which is growing in importance with the growing focus on clean and sustainable technologies. For FY18-21, Tatva Chintan’s revenue / PAT grew 30% / 62% CAGR, supported by a margin increase of nearly 500 basis points to 21.9%, “said Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services .
“Tatva Chintan is expected to do well based on its leadership position, broad product portfolio, strong customer relationships and capacity expansion that result in strong growth,” added Poddar.
“The specialty chemicals company received a massive response from subscribers and touched the daily limit of Rs 2534.2 on the NSE exchange. The company is a leading manufacturer of structural control agents and phase transfer catalysts with a diversified product portfolio, strong financial performance and a global market presence with a customer base in all industries, “said Sandeep Matta, Founder of TradeIT Investment Advisor.
“If fundamentals are strong, we recommend investors hold Tatva Chintan as a long-term portfolio stock and continue to stack the counter as they hit the target of over Rs 3,500 over the medium term,” said Matta.
“Tatva Chintan is a manufacturer of green chemicals such as structure directing agents (SDA), phase transfer catalysts (PTC), electrolyte salts for supercapacitor batteries, pharmaceutical and agrochemical intermediates, and other specialty chemicals. For the products SDA, PTC and electrolyte salts, TCPCL is the largest producer in India, while it is second in the world for zeolite. SDA and PTC products have various applications in “green chemistry”, which is relevant in view of the growing focus of industrialized and developing countries on green and sustainable technologies for reducing emissions and industrial emissions. The company can deliver EPS of Rs.32 and Rs.36 through fiscal 23rd and 24th, “said Ashish Chaturmohta, director of research at Sanctum Wealth Management.
“The company is listed at 100% Premium at the offer price. At the time of the IPO, the valuation was 30x FY24. However, based on its Stellar quotation, it won’t trade at 65x. Long-term investors should stay invested as there is a lot of moat, but they would not make new investments as they are now also more expensive than peers, “he said.
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