Ashish Kacholia's portfolio high ROE & high ROCE multibagger stock; Company completes successful fund raise of Rs 342.55 crores through preferential allotment

The stock gave multibagger returns of 1,115 per cent returns in 5 years and a whopping 5,200 per cent in a decade. 

Fineotex Chemical Limited, a leading specialty chemical manufacturer, announces the successful fund raising of Rs 342.5 Crores through a preferential allotment of equity shares and convertible warrants.

The fund-raising was executed in two distinct phases:

Phase I: The Company allotted 9,70,000 equity shares at an issue price of Rs 346 per share, aggregating to Rs 33.56 crore and 26,26,600 convertible warrants at a price of Rs 346 per warrant, aggregating to Rs 90.88 crore. The company has received an upfront payment of Rs 22.72 crores, representing 25 per cent of the total warrant issue size. Each warrant is convertible into one fully paid-up equity share upon the receipt of payment of Rs 259.50 per warrant (Remaining 75 per cent of the issue price) within 18 months from May 22, 2024.

Phase II: The Company allotted 28,15,049 equity shares at an issue price of Rs 387.40 per share, aggregating to Rs 109.05 crore and 28,15,049 convertible warrants at the same price, aggregating to Rs 109.05 crore. The company has received an upfront payment of Rs 27.26 crore, representing 25 per cent of the total warrant issue size. Each warrant is convertible into one fully paid-up equity share upon the receipt of payment of Rs 290.55 per warrant (Remaining 75 per cent of the issue price) within 18 months from July 19, 2024.

Today, shares of Fineotex Chemical Ltd (FCL) gained 0.82 per cent to an intraday high of Rs 364.25 per share from its previous closing of Rs 361.30. An ace investor, Ashish Kacholia has 31,35,568 shares or 2.81 per cent stake in the company as of May 2024. This company is financially strong with a market cap exceeding Rs 3,900 crore. The stock gave multibagger returns of 1,115 per cent returns in 5 years and a whopping 5,200 per cent in a decade. 

Fineotex Chemical Ltd, founded in 1979, is a leading manufacturer of speciality chemicals for various industries. Their core business is textile chemicals, with a focus on research and development through their subsidiary Biotex Malaysia. They also offer cleaning and hygiene products like sanitisers and detergents. Fineotex boasts over 470 product categories, including chemicals for every stage of textile production, oil and water-based drilling fluids, and home care disinfectants. With a presence in over 70 countries and a network of over 100 dealers, they serve major clients like Nahar Group and Raymond in the textile industry.

The consolidated business results for Q4 and FY 2023-2024 paint a positive picture. Revenue from operations grew steadily throughout the year, reaching Rs 15,3.02 crore in Q4, reflecting an 11.13 per cent year-over-year increase. This positive trend continued for the entire fiscal year, with total revenue reaching Rs 568.97 crore, a 10.05 per cent increase from the previous year. Profitability also showed strong improvement, with profit after tax (PAT) climbing to Rs 30.48 crore in Q4 (a 17.21 per cent rise) and reaching Rs 121.02 crore for the entire fiscal year (a significant 35.14 per cent increase compared to the prior year). Enhancing the positive performance, the consolidated business achieved a substantial 25.51 per cent year-over-year volume growth for the fiscal year.

The company achieved a strong return on capital employed (ROCE) of approximately 34.4 per cent and a return on equity (ROE) of approximately 29.9 per cent for the same fiscal year. Investors should keep an eye on this small-cap chemical stock.

Disclaimer: The article is for informational purposes only and not investment advice.

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