Tatva Chintan Pharma is a very bright spark today morning in an otherwise lacklustre market. The stock opened almost 13.5% higher at Rs.2415.30 and went on to hit a new high at Rs.2488.90.
The company, for Q2FY22 posted a consolidated net profit of Rs.32 crore, up 811% on a YoY and up 40% QoQ. This was on a net revenue of Rs.124 crore, up 106% (YoY) and up 16% (QoQ).
A specialty chemicals manufacturing company, 40% revenue comes from structure directing agents (SDAs), 30% from phase transfer catalysts (PTCs) used in improving yields and reducing process waste, and balance from pharma and agro API.
The company recently concluded its IPO. Fresh issue proceeds of Rs. 150 cr will be used towards capex at Dahej, to increase installed capacity from 280 KL to 480 KL over next 16 months. New facility will also enjoy tax breaks towards 50% of profits till FY27. Thus, company’s net profits can potentially double by FY24, on higher revenue and lower effective tax rate of ~18% between FY23-27.
The stock made a smashing debut on the bourses on 29th July, listing on the BSE at Rs.2111.80 v/s IPO price of Rs.1083. The IPO had received a fantastic response, subscribing 180.36 times.