Fairchem Organics Ltd
NSE:FAIRCHEMOR
Fairchem Organics Ltd
Fairchem Organics Ltd. engages in the manufacture, supply and export of aroma, nutraceuticals and oleo chemicals. The company is headquartered in Navi Mumbai, Maharashtra and currently employs 221 full-time employees. The company went IPO on 2020-12-24. Nutraceuticals include natural concentrated tocopherols and natural concentrated sterols. Oleochemicals include Dimer Acid (HIPOL 100), Distilled Fatty Acid, Dimer Acid (HIPOL 800), Monobasic Acid (HIFAC 101), Distilled Fatty Acid (Soya Fatty Acid), Palmitic Acid, Linoleic Acid and Residue. The firm is engaged in manufacturing a range of oleo chemicals (high grade fatty acids) from the waste products generated during refining of soft vegetables oils. In addition to this, the Company also offers aroma chemicals, such as Amber Fleur, Dihydromycenol and Citral derivatives. The aroma chemicals are primarily made from the waste generated in the pulp and paper mills.
Fairchem Organics Ltd. engages in the manufacture, supply and export of aroma, nutraceuticals and oleo chemicals. The company is headquartered in Navi Mumbai, Maharashtra and currently employs 221 full-time employees. The company went IPO on 2020-12-24. Nutraceuticals include natural concentrated tocopherols and natural concentrated sterols. Oleochemicals include Dimer Acid (HIPOL 100), Distilled Fatty Acid, Dimer Acid (HIPOL 800), Monobasic Acid (HIFAC 101), Distilled Fatty Acid (Soya Fatty Acid), Palmitic Acid, Linoleic Acid and Residue. The firm is engaged in manufacturing a range of oleo chemicals (high grade fatty acids) from the waste products generated during refining of soft vegetables oils. In addition to this, the Company also offers aroma chemicals, such as Amber Fleur, Dihydromycenol and Citral derivatives. The aroma chemicals are primarily made from the waste generated in the pulp and paper mills.
Revenue Drop: Q3 revenue declined by 12% year-on-year to INR 100 crores, mainly due to lower offtake in the paint segment and loss of exports to the US.
Profitability Impact: Margins and net profit shrank significantly, with Q3 EBITDA margin at 4.2% and PAT margin at 0.6%, pressured by high raw material costs and cheap imports from China.
Raw Material & Pricing Pressure: Elevated raw material prices and a disadvantageous import duty structure limited the company’s ability to pass on costs to customers, especially in the Dimer Acid segment.
Export Prospects Improving: Management expects export recovery due to US tariff changes and potential trade deals with the UK and EU, particularly benefiting export-driven products like Isostearic Acid.
Recovery Outlook: Management is confident the worst quarter is over and expects gradual improvement in volumes and margins, with a meaningful rebound anticipated from H2 FY '27.
New Products & Initiatives: The animal feed plant is ready, pending certification, and a new product is set for launch by Q3. Capacity for both is being added prudently, with further expansion dependent on approvals.
No Major CapEx Needed: Management sees no need for significant new capital expenditure, given current spare capacity that can support a major increase in export turnover.
