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Check Before You Invest : Chemtech Industrial Valves Ltd

BSE: 537326 NSE: ISIN: INE212P01011
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering - Industrial Equipments

Snapshot

Q.1 Which industry/sub-sector does Chemtech Industrial Valves Ltd belong to?
Chemtech Industrial Valves Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering - Industrial Equipments segment.
Q.2 Is Chemtech Industrial Valves Ltd a good quality company?
Chemtech Industrial Valves Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Chemtech Industrial Valves Ltd undervalued or overvalued?
Chemtech Industrial Valves Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 25.05 33.50
Price to Book 1.42 2.29
Price to Sales 4.78 3.33
EV to EBITDA 8.42 14.98
Q.4 Is Chemtech Industrial Valves Ltd a good buy now?
Chemtech Industrial Valves Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd revenue growth is 27.6% for FY-2025, which is above its 5-year CAGR of 15.41%, indicating faster growth.

Q.2 Gross Profit margin of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Gross profit margin which is the profit after deduction of direct costs, is 25.5% for FY-2025, which is above its 5-year median of 16.3%, indicating increasing margins.

Q.3 Operating Profit Margin of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 19.82% for FY-2025, which is in line with its 5-year median of 19.78% indicating stable margins.

Q.4 Net Profit Margin of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Net Profit Margin is 17.52% for FY-2025, is above its 5-year median of 13.24%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 25.5 16.3
Operating Profit Margin (%) 19.82 19.78
Net Profit Margin (%) 17.52 13.24

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Return on Asset is 9.04%, which is in line with its 5-year historical median of 9.04%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Return on capital employed is 14.25% for FY-2025, which is in line with its 5-year historical median of 14.25%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Return on equity is 11.51% for FY-2025, which is in line with its 5-year historical median of 11.51%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Cash conversion cycle is 58 days, in line with its 5-year historical median of 59 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.52 0.54
ROE (%) 11.51 11.51
ROCE (%) 14.25 14.25
Cash Conversion Cycle 58 days 59 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.18, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Chemtech Industrial Valves Ltd?
Chemtech Industrial Valves Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Chemtech Industrial Valves Ltd?

Q.1 Promoter shareholding and pledge status of Chemtech Industrial Valves Ltd?
Promoters hold 39.03% of the Chemtech Industrial Valves Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Chemtech Industrial Valves Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Chemtech Industrial Valves Ltd vs industry peers?
Chemtech Industrial Valves Ltd revenue CAGR is 15.41%, compared to the industry median CAGR of 3.04%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 27.6 3
Gross Profit Growth (%) 100 23.6
Operating Profit Growth (%) 33.3 21.7
Net Profit Growth (%) 75 27.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.52 0.89
ROE (%) 11.51 12.09
ROCE (%) 14.25 14.64
Cash Conversion Cycle (days) 57.76 98

Valuation & price assessment

Q.1 Stock return of Chemtech Industrial Valves Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 15.2% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
15.2% 49.8% 23.5% -40.7%
Q.2 Valuation ratios of Chemtech Industrial Valves Ltd vs historical?
The current P/E ratio of 25.05 is lower than its historical median of 33.50, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 25.05 33.50 29.36
Price to Book 1.42 2.29 2.91
Price to Sales 4.78 3.33 2.93
EV to EBITDA 8.42 14.98 15.77

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