Rs 1 lakh to Rs 11 lakh: This chemical stock held by Ashish Kacholia has soared 1000 per cent in just 2 years!

The company caters to the needs of more than 12 industries across 57 countries globally.

The last two years have augured well for the chemical manufacturing companies, with many of them delivering multibagger returns to their investors. One such company that has made it to the list is Vishnu Chemicals Ltd. 

Vishnu Chemicals Ltd, a speciality chemical company based in Hyderabad, has delivered 10x returns to its shareholders in the last 2 years. During this period, the company’s share price has risen steadily from Rs 123.95 on June 22 2020 to Rs 1,362.25 on June 17 2022, exhibiting an appreciation of 1000 per cent!

The company manufactures, markets and exports Chromium chemicals and Barium compounds across the world. The former contributes nearly 85 per cent of the company’s total revenue while the latter contributes the remaining 15 per cent. The demand in the chromium segment comes from its increasing usage in several industries owing to the benefits of untarnished, uniform and corrosion-resistant properties of chromium chemicals.  

On the other hand, the rising preference for a luxury living has increased the demand for ceramic tiles. This, in turn, has fueled the demand for the company’s barium segment.  

Ashish Kacholia, aka the ‘Big Whale’, is one of the investors in Vishnu Chemicals. The ace investor has been invested in the company since December 2015. At present, he owns 5 lakh shares of Vishnu Chemicals, representing a stake of 4.19 per cent.  

The company’s share price appreciation is backed by a robust financial performance. In the last 8 quarters (from March 2020 to March 2022), the company’s topline has increased from Rs 156 crore to Rs 334 crore, representing a growth of over 110 per cent. Similarly, the bottom line has grown from Rs 5 crore to Rs 29 crore, representing an increase of 480 per cent!  

Furthermore, the company is consistently improving its debt-to-equity ratio, which comes as a relief in the current rising rates scenario. The company’s interest coverage ratio stands at 5x. On the valuations front, the company is trading at a TTM PE of 19.99x, as against the industry PE of 28.22x. Moreover, in FY22, the company delivered an ROE & ROCE of 29.40 per cent and 28.65 per cent, respectively. 

At 3.21 pm, the shares of Vishnu Chemicals Ltd were trading at Rs 1,380 apiece.