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Check Before You Invest : Hindcon Chemicals Ltd

BSE: 0 NSE: HINDCON ISIN: INE642Y01029
  |   Sector:  Chemicals & Fertilizers   |   Industry:  Chemicals

Snapshot

Q.1 Which industry/sub-sector does Hindcon Chemicals Ltd belong to?
Hindcon Chemicals Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Chemicals segment.
Q.2 Is Hindcon Chemicals Ltd a good quality company?
Hindcon Chemicals Ltd is a good quality company, based on a consistently good 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 Hindcon Chemicals Ltd undervalued or overvalued?
Hindcon Chemicals Ltd appears Somewhat Undervalued, as its key valuation ratios are lower than 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 26.83 32.65
Price to Book 2.08 2.81
Price to Sales 1.67 1.87
EV to EBITDA 14.53 18.43
Q.4 Is Hindcon Chemicals Ltd a good buy now?
Hindcon Chemicals Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. 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 Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd revenue growth is 12% for FY-2026, which is above its 5-year CAGR of 7.43%, indicating faster growth.

Q.2 Gross Profit margin of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Gross profit margin which is the profit after deduction of direct costs, is 8.6% for FY-2026, which is below its 5-year median of 10.2%, indicating decreasing margins.

Q.3 Operating Profit Margin of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 6.04% for FY-2026, which is below its 5-year median of 7.59% indicating decreasing margins.

Q.4 Net Profit Margin of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Net Profit Margin is 5.12% for FY-2026, is below its 5-year median of 7%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 8.6 10.2
Operating Profit Margin (%) 6.04 7.59
Net Profit Margin (%) 5.12 7

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Return on Asset is 5%, which is below its 5-year historical median of 8.63%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Return on capital employed is 8.76% for FY-2026, which is below its 5-year historical median of 14.94%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Return on equity is 6.28% for FY-2026, which is below its 5-year historical median of 11.15%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Cash conversion cycle is 120 days, above its 5-year historical median of 113 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.98 1.18
ROE (%) 6.28 11.15
ROCE (%) 8.76 14.94
Cash Conversion Cycle 120 days 113 days

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

Q.9 Debt to Equity ratio of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Debt-to-Equity ratio is 0.20, which is above the industry average of 0.13, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Hindcon Chemicals Ltd?
Hindcon Chemicals Ltd Debt to cash flow from operations is -3.18, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Hindcon Chemicals Ltd?

Q.1 Promoter shareholding and pledge status of Hindcon Chemicals Ltd?
Promoters hold 68.81% of the Hindcon Chemicals Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Hindcon Chemicals Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Hindcon Chemicals Ltd vs industry peers?
Hindcon Chemicals Ltd revenue CAGR is 7.43%, compared to the industry median CAGR of 7.42%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 12 7.4
Gross Profit Growth (%) -16.7 9.7
Operating Profit Growth (%) - 7
Net Profit Growth (%) -25 7
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.98 0.93
ROE (%) 6.28 9.58
ROCE (%) 8.76 12.17
Cash Conversion Cycle (days) 119.93 64

Valuation & price assessment

Q.1 Stock return of Hindcon Chemicals Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of -19.95% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- -20% -44.9% -32.4%
Q.2 Valuation ratios of Hindcon Chemicals Ltd vs historical?
The current P/E ratio of 26.83 is lower than its historical median of 32.65, 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 26.83 32.65 28.17
Price to Book 2.08 2.81 2.22
Price to Sales 1.67 1.87 1.93
EV to EBITDA 14.53 18.43 14.20

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