Check Before You Invest : Indokem Ltd

Q: Which industry/sub-sector does Indokem Ltd belong to?

Indokem Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Chemicals segment.

Q: Is Indokem Ltd a good quality company?

Indokem Ltd is a weak quality company, based on a inconsistent 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: Is Indokem Ltd undervalued or overvalued?

Indokem Ltd appears Overvalued, as its key valuation ratios are higher 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. Price to Earnings, Current: 792.13, Historic Median: 43.16. Price to Book, Current: 44.73, Historic Median: 6.89. Price to Sales, Current: 11.4, Historic Median: 2.07. EV to EBITDA, Current: 224.12, Historic Median: 75.53

Q: Is Indokem Ltd a good buy now?

Indokem 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

Q: Revenue growth of Indokem Ltd?

Indokem Ltd revenue growth is 10.1% for FY-2025, which is below its 5-year CAGR of 11.39%, indicating slower growth.

Q: Gross Profit margin of Indokem Ltd?

Indokem Ltd Gross profit margin which is the profit after deduction of direct costs, is 1.9% for FY-2025, which is in line with its 5-year median of 1.9%, indicating stable margins.

Q: Operating Profit Margin of Indokem Ltd?

Indokem Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 3.25% for FY-2025, which is in line with its 5-year median of 3.25% indicating stable margins.

Q: Net Profit Margin of Indokem Ltd?

Indokem Ltd Net Profit Margin is 0.6% for FY-2025, is in line with its 5-year median of 0.6%, indicating stable margins. Profitability Metrics. Gross Profit Margin (%), Current: 1.9, Historic Median: 1.9. Operating Profit Margin (%), Current: 3.25, Historic Median: 3.25. Net Profit Margin (%), Current: 0.6, Historic Median: 0.6

Q: Return on Asset of Indokem Ltd?

Indokem Ltd Return on Asset is 0.74%, which is in line with its 5-year historical median of 0.74%, indicating stable asset utilization efficiency.

Q: Return on capital employed (ROCE) of Indokem Ltd?

Indokem Ltd Return on capital employed is 6.59% for FY-2025, which is in line with its 5-year historical median of 6.59%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Check Before You Invest : Indokem Ltd

Snapshot

Q.1 Which industry/sub-sector does Indokem Ltd belong to?

Indokem Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Chemicals segment.

Q.2 Is Indokem Ltd a good quality company?

Indokem Ltd is a weak quality company, based on a inconsistent 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 Indokem Ltd undervalued or overvalued?

Indokem Ltd appears Overvalued, as its key valuation ratios are higher 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	792.13	43.16
Price to Book	44.73	6.89
Price to Sales	11.4	2.07
EV to EBITDA	224.12	75.53

Q.4 Is Indokem Ltd a good buy now?

Indokem 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 Indokem Ltd?

Indokem Ltd revenue growth is 10.1% for FY-2025, which is below its 5-year CAGR of 11.39%, indicating slower growth.

Q.2 Gross Profit margin of Indokem Ltd?

Indokem Ltd Gross profit margin which is the profit after deduction of direct costs, is 1.9% for FY-2025, which is in line with its 5-year median of 1.9%, indicating stable margins.

Q.3 Operating Profit Margin of Indokem Ltd?

Indokem Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 3.25% for FY-2025, which is in line with its 5-year median of 3.25% indicating stable margins.

Q.4 Net Profit Margin of Indokem Ltd?

Indokem Ltd Net Profit Margin is 0.6% for FY-2025, is in line with its 5-year median of 0.6%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	1.9	1.9
Operating Profit Margin (%)	3.25	3.25
Net Profit Margin (%)	0.6	0.6

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Indokem Ltd?

Indokem Ltd Return on Asset is 0.74%, which is in line with its 5-year historical median of 0.74%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Indokem Ltd?

Indokem Ltd Return on capital employed is 6.59% for FY-2025, which is in line with its 5-year historical median of 6.59%. 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 Indokem Ltd?

Indokem Ltd Return on equity is 2.81% for FY-2025, which is in line with its 5-year historical median of 2.81%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Indokem Ltd?

Indokem Ltd Cash conversion cycle is 39 days, below its 5-year historical median of 51 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	1.24	1.24
ROE (%)	2.81	2.81
ROCE (%)	6.59	6.59
Cash Conversion Cycle	39 days	51 days

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

Q.9 Debt to Equity ratio of Indokem Ltd?

Indokem Ltd Debt-to-Equity ratio is 0.66, 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 Indokem Ltd?

Indokem Ltd Debt to cash flow from operations is 5.5, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Indokem Ltd?

Q.1 Promoter shareholding and pledge status of Indokem Ltd?

Promoters hold 68.67% of the Indokem Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Indokem Ltd vs industry peers?

Indokem Ltd revenue CAGR is 11.39%, compared to the industry median CAGR of 7.53%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	10.1	7.5
Gross Profit Growth (%)	0	12.1
Operating Profit Growth (%)	0	11.7
Net Profit Growth (%)	0	9.7

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	1.24	0.93
ROE (%)	2.81	10.17
ROCE (%)	6.59	12.96
Cash Conversion Cycle (days)	38.83	62

Valuation & price assessment

Q.1 Stock return of Indokem Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 58.4% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	58.4%	74.1%	73.6%	229.4%

Q.2 Valuation ratios of Indokem Ltd vs historical?

The current P/E ratio of 792.13 is higher than its historical median of 43.16, indicating that the stock is trading above 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	792.13	43.16	28.17
Price to Book	44.73	6.89	2.22
Price to Sales	11.4	2.07	1.93
EV to EBITDA	224.12	75.53	14.20

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Check Before You Invest : Indokem Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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Check trending companies

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