This chemical stock defies gravity; surges 43% in four sessions

At a time when domestic equity benchmarks are witnessing volatility due to persistent concerns about higher inflation and sustained selling by foreign investors, some stocks have managed to continue their record-setting spree. Chemical manufacturing company Fine Organic Industries is one such multibagger share that has defied gravity and rallied 43% in the last four sessions, as compared to a 1.3% gain in BSE benchmark Sensex during this period.

Investors are betting high on this midcap chemical stock, with the share price rising from ₹4,095 on May 27, to ₹5,875 in an intraday today, registering a growth of 43.4% during the period under review. The share price of Mumbai-headquartered oleochemical-based additives manufacturer has more than doubled in the last nine months, from its 52-week low of ₹2,735.45 touched on August 23, 2021.

Extending its gaining streak for the fourth straight session, Fine Organic shares opened marginally higher at ₹5,150, against the previous closing price of ₹5,122 on the BSE. During the session so far, the stock gained 14.7% to hit an all-time high of ₹5,875 levels, driven by strong volume. There was a surge in buying as 19,000 shares worth ₹10.66 crore changed hands over the counter on the BSE against a two-week average volume of 6,246. The market capitalistion of the company climbed to ₹17,838.6 crore.

Fine Organic shares have delivered solid returns to its shareholders since its listing on July 2, 2018, with stock price rallying more than 600% against its issue price of ₹783. The stocks are currently trading higher than 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. The stock has gained 34% in a week, 23% in the past one month, and 45% in the calendar year 2022. It has risen 50% over six months and 81% in the last one year.

Strong Q4 boosted earnings

The additives manufacturer on May 30 reported its fourth quarter earnings, which saw its consolidated net profit jumping 283% to ₹121.85 crore in March quarter of FY22 as compared to ₹31.79 crore in the same period last year. Revenue from operations surged 91% to ₹616.87 crore from ₹322.88 crore in Q4 FY22 over Q4 FY21.

For the full financial year 2021-22, Fine Organic reported 115.8% rise in consolidated net profit to ₹259.61 crore on a 65.6% spurt in revenue from operations to ₹1,876.26 crore as compared to last fiscal. The board has also recommended a final dividend of ₹9 per equity share for the financial year ended 31 March 2022.

Incorporated in 2005, Fine Organic Industries, a part of the Fine Organic Group, is engaged in the manufacturing of oleochemical additives for various end-user industries such as foods, plastics, rubbers, paints, inks, cosmetics, coatings, textile auxiliaries and lubes.