Buy PCBL Chemical; target of Rs 360: Prabhudas Lilladher

Moneycontrol • 1 day ago

Original source

Key Investment Pillars

  • Improving global carbon black supply-demand dynamics, with higher coal tar costs in China and lower Russian refinery throughput, could tighten feedstock availability and support realizations.
  • PCBL Chemical's focus on expanding long-term supply and offtake arrangements with strategic customers may lead to better pricing and volume growth.
  • The company's expansion into silicon-carbon composite solutions and the commissioning of its superconductive black facility could drive future growth.
  • Management expects double-digit revenue growth in FY27, driven by the Aquapharm segment, which saw a 10% YoY increase in revenue.

Thesis Validation Checklist

To validate the investment thesis, watch for:

  • Improvement in global carbon black supply-demand dynamics, leading to higher realizations.
  • Successful expansion of long-term supply and offtake arrangements with strategic customers.
  • Growth in the Aquapharm segment, driven by green chelates and other application-specific solutions.
  • Progress in the development of silicon-carbon composite solutions and the superconductive black facility.
  • PCBL Chemical's ability to maintain its EBITDA/ton guidance and achieve double-digit revenue growth in FY27.