Corporate Report     

Published: Mar 31, 2023
Updated: Mar 31, 2023

Anupam Rasayan India

Growing from strength to strength

Gujarat-based Anupam Rasayan, a leading manufacturer of multi-synthesis molecules such as speciality chemicals related to agrochemicals, personal care and pharmaceuticals which has cross the milestone of Rs. 1000-crore turnover last year is growing from strength to strength.

The company manufactures multi-synthesis molecules such as: (a) Life science-related speciality chemicals comprising products related to agrochemicals, personal care and pharmaceuticals; and (b) Other speciality chemicals comprising speciality pigments and dyes as well as polymer additives on an exclusive basis for its customers. The company has six manufacturing facilities — four in Sachin near Surat and two in Zagadia. Some of these facilities are ISO 9001:2015 and ISO 14000:2015 certified. The company is known for its sound technology, environmental consciousness, rich history of innovation through research, and total commitment to excellence in quality and sustainability. The company is doing well, but its prospects going ahead are all the more exciting.

• The company has made rapid strides on the financial front. During the last 12 years its sales turnover has shot up from Rs. 107 crore in the fiscal 2011 to Rs. 1066 crore in the fiscal 2022 with operating profit zooming from Rs. 21 crore to Rs. 296 crore and the profit at net level skyrocketing from Rs. 77 crore to Rs. 151 crore. During the last five years, the company’s sales have grown at a CAGR of 30 per cent and compounded profit has surged at a CAGR of 34 per cent.

The company’s financial position is also very sound with reserves at the end of March 2022 standing at Rs. 1693 crore as against its equity capital of Rs. 100 crore.

• Going ahead, the company’s growth prospects are all the more promising. Recently, it signed a letter of intent worth $ 95 million (around Rs 700 crore) with a major multinational crop protection company to supply a new life science-related active ingredient. The company has entered into a long- term contract to supply this speciality chemical product for the next five years. According to Anand Desai, Managing Director of Anupam, the company has to date signed LoIs worth Rs 1,800 crore and contracts worth Rs 820 crore, taking the total contract LoIs signed in this fiscal year to Rs 2,620 crore. These trades demonstrate firm revenue visibility for growth in the coming years.

These products were conceptualised within 3 months and it took under 18 months from conceptualisation to commercialisation of these products. The company is able to deliver these products in such short period on urgent request of our customer.

Moreover, both of these products were being manufactured in Europe. Now the customer has decided to source these products exclusively from Anupam. The management is starting to see this trend of India being chosen as preferred manufacturing base for strategical products presently being manufactured in Europe. The company is working with few more MNC clients and expect 20 to 25 niche products to be added in Anupam’s product portfolio in near term as of part of Europe plus one strategy.

• With a view to expanding its fluorination chemistry business, Anupam has acquired a 24.96 per cent equity stake and joint control of Tanfac Industries Ltd (TIL) and has become a promoter jointly with the Tamil Nadu Industrial Development Corporation. TIL is a speciality fluorides chemical manufacturer while Anupam is a leading producer of hydrofluoric acid and is also engaged in the manufacture of other organic and inorganic fluorine-based products. This acquisition and joint management control will create significant value for Anupam through synergies and expand its fluorination chemistry business.
• A plus point for Anupam Rasayan is the importance it gives to research and development. The company has developed a strong R&D structure to drive its growth. Thanks to its fully equipped R&D team, the company has secured a strong market position at home as well as abroad. The management strongly believes that continued investment in R&D activities is imperative for continued success and growth.

During the current bearish environment, the share price of Anupam Rasayan has tumbled from a 52- week high of around Rs 1,107 to Rs around Rs 631 but has soon recovered to Rs. 748 by now. The current price level is highly attractive for discerning investors to invest in such a growthoriented company. Once the current phase of market depression is over, the Anupam stock price is most likely to cross the Rs 1,000-mark once again.