MoneyWorks4Me

Check Before You Invest : Punjab Chemicals & Crop Protection Ltd

BSE: 506618 NSE: PUNJABCHEM ISIN: INE277B01014
  |   Sector:  Chemicals & Fertilizers   |   Industry:  Pesticides & Agrochemicals

Snapshot

Q.1 Which industry/sub-sector does Punjab Chemicals & Crop Protection Ltd belong to?
Punjab Chemicals & Crop Protection Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Pesticides & Agrochemicals segment.
Q.2 Is Punjab Chemicals & Crop Protection Ltd a good quality company?
Punjab Chemicals & Crop Protection 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 Punjab Chemicals & Crop Protection Ltd undervalued or overvalued?
Punjab Chemicals & Crop Protection Ltd appears 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 21.91 23.64
Price to Book 2.99 4.00
Price to Sales 1.32 1.46
EV to EBITDA 11.5 12.19
Q.4 Is Punjab Chemicals & Crop Protection Ltd a good buy now?
Punjab Chemicals & Crop Protection 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 Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd revenue growth is 14.1% for FY-2026, which is above its 5-year CAGR of 8.68%, indicating faster growth.

Q.2 Gross Profit margin of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Gross profit margin which is the profit after deduction of direct costs, is 11% for FY-2026, which is in line with its 5-year median of 10.7%, indicating stable margins.

Q.3 Operating Profit Margin of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 11.61% for FY-2026, which is in line with its 5-year median of 12.12% indicating stable margins.

Q.4 Net Profit Margin of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Net Profit Margin is 5.99% for FY-2026, is in line with its 5-year median of 5.99%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 11 10.7
Operating Profit Margin (%) 11.61 12.12
Net Profit Margin (%) 5.99 5.99

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Return on Asset is 6.45%, which is below its 5-year historical median of 7.29%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Return on capital employed is 17.2% for FY-2026, which is below its 5-year historical median of 21.52%. 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 Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Return on equity is 14.85% for FY-2026, which is below its 5-year historical median of 16.84%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Cash conversion cycle is 84 days, above its 5-year historical median of 69 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) 1.08 1.25
ROE (%) 14.85 16.84
ROCE (%) 17.2 21.52
Cash Conversion Cycle 84 days 69 days

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

Q.9 Debt to Equity ratio of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Debt-to-Equity ratio is 0.35, which is above the industry average of 0.27, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Punjab Chemicals & Crop Protection Ltd?
Punjab Chemicals & Crop Protection Ltd Debt to cash flow from operations is 1.56, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Punjab Chemicals & Crop Protection Ltd?

Q.1 Promoter shareholding and pledge status of Punjab Chemicals & Crop Protection Ltd?
Promoters hold 39.24% of the Punjab Chemicals & Crop Protection Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Punjab Chemicals & Crop Protection Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Punjab Chemicals & Crop Protection Ltd vs industry peers?
Punjab Chemicals & Crop Protection Ltd revenue CAGR is 8.68%, compared to the industry median CAGR of 8.01%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 14.1 8
Gross Profit Growth (%) 34.9 7.7
Operating Profit Growth (%) 17.2 7.2
Net Profit Growth (%) 52.5 7.7
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.08 1.18
ROE (%) 14.85 12.73
ROCE (%) 17.2 15.96
Cash Conversion Cycle (days) 84.49 96

Valuation & price assessment

Q.1 Stock return of Punjab Chemicals & Crop Protection Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 19.4% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
19.4% -7.2% -0.4% -5.3%
Q.2 Valuation ratios of Punjab Chemicals & Crop Protection Ltd vs historical?
The current P/E ratio of 21.91 is lower than its historical median of 23.64, 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 21.91 23.64 24.78
Price to Book 2.99 4.00 2.67
Price to Sales 1.32 1.46 1.43
EV to EBITDA 11.5 12.19 12.86

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