Fine Organic hits record excessive; soars 35% in four days on strong Q4 results

Shares of Fine Organic Industries hit a brand new excessive at Rs 5,523, up 8 per cent on the BSE in Thursday’s intra-day commerce, in an in any other case subdued market. In the previous four buying and selling days, the stock of the specialty chemical compounds has soared 34.7 per cent after the company reported strong March quarter (Q4FY22) earnings, with consolidated revenue after tax (PAT) rising practically four-fold to Rs 121.7 crore when comapred with a PAT of Rs 31.8 crore in Q4FY21.

At 10:40 AM; the stock traded 6 per cent larger at Rs 5,448, as in comparison with a 0.36 per cent rise in the S&P BSE Sensex. With the previous four-day rally, the stock now trades at an virtually 600 premium to its situation worth of Rs 783 per share. The company had made its stock market debut on July 2, 2018 and had hit a record low of Rs 735.20 on July 23, 2018.

In Q4FY22, the company’s income grew 91 per cent year on year (YoY) to Rs 617 crore as in opposition to Rs 323 crore in the year-ago quarter. Earnings earlier than curiosity, taxes, depreciation, and amortization (Ebitda) jumped 227 per cent YoY to Rs 159 crore. Ebitda margins improved to 25.8 per cent from 15.1 per cent owing to shift in the product combine in the direction of high- margin value-added merchandise, new prospects, and new approvals in Q4.

The board has advisable a closing dividend of Rs 9 per fairness share for the monetary year ended March 31, 2022.

Analysts at HDFC Securities stated they like Fine Organics, owing to management in oleo-chemical primarily based components in the home and world markets with a loyal buyer base, distinctive business mannequin with excessive entry boundaries, diversified product portfolio, and pricing energy. However, they downgraded the stock from BUY to ADD, with a revised goal worth of Rs 5,290.

“The downgrade is largely owing to 22 per cent increase in the stock price in the past three months,” the brokerage agency stated in a report dated June 1, 2022.

Fine Organic carries on business in India and overseas, as producers, processors, suppliers, distributors, sellers, importers, exporters of wide selection of oleochemical-based components used in meals, plastics, cosmetics, coatings and different specialty application in varied industries. The subsidiaries are engaged in buying and selling of product manufactured by the dad or mum company.

Tech view

Outlook: Bullish

Support: Rs 4,910

On the again of a 33-per cent rally over the previous 4 days, the stock of Fine Organics surpassed its speedy resistance of Rs 5,114, on the every day charts. The degree, now, turns into its speedy assist, adopted by Rs 4,462-mark, which is its 20-day shifting common (20-DMA). The weekly chart suggests assist on the higher finish of the Bollinger Band at Rs 4,910.

On the upside, the stock can doubtlessly rally as much as Rs 5,625 as indicated by the yearly Fibonacci chart.

The price-to-moving common motion, in addition to momentum indicators, are in the favour of the bulls. While the 14-day Relative Strength Index (RSI) has minutely entered the overbought zone, all different indicators spotlight energy in the stock.

(With inputs from Nikita Vashisht)

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