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Fine Organics Share Price Analysis: Best Stocks to invest in 2024 for long term: Q2FY24 Results:
Fine Organics Share Price analysis is presented here with its Q2FY24 results which may be useful in selecting best stocks to invest in 2024 for long term.
Do you know the common thing among cookie, cream, lipstick, chocolate, ice-cream, paint, adhesives, medicines & tyre?
They all use chemicals, also used as additives and the one company which makes all these additives is Fine Organics, sector leader of Oleochemical Derivatives.
Table of Contents
Fine Organics Business Model:
Fine Organics was established in 1970 and became largest producer of Oleochemical derivatives in India and among top 6 polymer additive producers in the whole world. In addition to India Fine Organics also have warehouses in Europe & USA. Company has its presence in 80+ countries with 850+ Direct Customers, 180+ Distributors with 470+ products. Therefore, the business model may be considered in Fine Organics share price analysis before selecting best stocks to invest in 2024 for long term.
Customers of Fine Organics:
Coca Cola, Britannia, Asian Paints, Parle, Pidilite, Berger Paints etc. are some of the customers of Fine Organics. These reputed customers play key role while analysing Fine Organic Share Price and while selecting best stocks to invest in 2024.
Management & Leadership of Fine Organics:
Mr Mukesh Shah is Chairman & MD of Fine Organics who is associated with Fine Organics since 1973 and have wide experience of almost 50+ years in the company.
Mr Jayen Shah is Executive Director & CEO of Fine Organics and associated with the company since 1986 having wide experience of 35+ years.
This well experienced management should be key factor while analysing Fine Organics Share Price and before selecting the best stock to invest in 2024 for long term.
Financial Performance of Fine Organics:
From 2016 to 2023 i.e. in last 7 years Fine Organics sales are grown by about 5 times, Operating Profit is grown by nearly 5 times and Net Profit is nearly grown by 8 times.
Fine Organics has positive Cash Flow and high ROE which is exceptional. Further its good OPM (Operating Profit Margin), manifests its competitive advantage and high GPM (Gross Profit Margin) indicates its good pricing power. Therefore, Fine Organics may be considered before selecting best stocks to invest in 2024 for long term.
Q2 FY 24 Results of Fine Organics:
Due to slowdown in Europe and inflation in prices of Raw Materials as well as China is dumping its over produced raw materials at very cheap prices its Q2FY24 results are not promising but this is the case with entire Chemical Sector and may be continued due to geopolitical instability. Therefore, investors must look on Q2FY24 results, while analysing Fine Organics Share Price and before selecting best stocks to invest in 2024 for long term. Its Q2FY24 results are as following:
|Sales||– 1.3%||– 41.2%|
|Operating Profit or EBIDT||– 7.1%||– 48.8%|
|OPM||– 2%||– 4%|
Fine organics Q2FY24 weak set of numbers. Margins deteriorating sequentially. Enough for a stock's negative movement.— Manish Yadav (@immanishyadav01) October 30, 2023
Revenue -1.22% QoQ/ -41.19% YoY.
EBITDA -4.8% QoQ/ -45.76% YoY.
EBITDA margins 23.86% -386bps.
PAT +3.6% QoQ/ -48.96% QoQ. pic.twitter.com/d3Jo0ubRc3
Debt on Fine Organics:
Fine Organics is almost debt free which is very good sign. Investors should try to find stocks which are debt free for selecting the best stocks to invest in 2024 for long term and analysing Fine Organics Share Price.
Future Growth Prospects of Fine Organics:
Due to advantages of oleochemicals over synthetic chemicals and increasing awareness towards natural, healthy and environment friendly products, oleochemicals have strong and bright future perspectives in modern world as its demand is increasing day by day in multiple industries such as cosmetics, medical, food, plastic, rubber, coating etc. Therefore, Fine Organics may be considered while analysing Fine Organics Share Price and before selecting best stocks to invest in 2024 for long term.
Moat/Competitive Advantage of Fine Organics:
Fine Organic is sector leader.
Entry barrier for new comers in chemical sector as it requires multiple regulatory clearances and approvals as additives have direct impact in human life as well as environment.
Due to environment friendly, biodegradability, derived from natural resources, healthy, less toxic and less hazardous nature its demand is increasing day by day with increase in customer awareness and this differentiate it with other conventional companies.
Further in chemical sector it requires complex technology and it is time and capital intensive which also creates a strong entry barrier and here Fine Organics have early mover advantage with large experience and consistent track record.
Further Fine Organics have strong inhouse R&D team with more than 50 years of experience which makes it very unique.
Further High Switching Cost for Customers also gives fine organic a competitive edge over others as additives used in products go through stringent regulatory compliances and here customers rely on established players.
Further Fine Organics have diversified product portfolio ranging from food to cosmetics and pharmaceutical to paint and adhesives which itself provides a great stability.
Therefore, this strong moat may be considered while analysing Fine Organics Share Price and before selecting best stocks to invest in 2024 for long term.
Risks associated with Fine Organics:
Prices of Raw Material is key risk of Fine Organics. It uses Palm oil, Sunflower Oil, Soya Oil, Coconut Oil etc as Raw Material and fluctuation in prices of these Raw Materials is a risk factor for Fine Organics as increase in prices of these Raw Materials may negatively impact the margins of Fine Organic.
Slowdown in Consumption is also a key risk associated with Fine Organic as it has B to B (Business to Business) model and any impact at end industries such as cosmetics, food, drugs etc may direct reflect on Fine Organics.
These risk factors must be considered before selecting the best stock to invest in 2024 for long term.
Shareholding Pattern in Fine Organics:
In Fine Organic its promoters have consistent shareholding of 75% even in negative environment which boosts confidence of investors.
FIIs & DIIs also have a decent stake in the company which further boosts confidence of investors.
This shareholding pattern may be considered while analysing Fine Organics Share Price and before selecting best stocks to invest in 2024.
Latest news on Fine Organics:
Investors can track latest news and updates of Fine Organics on its official website on
Fine Organics NSE/BSE share price today, share price history, 52 week high/low may be checked on :
Food Ingredients, Polymer Additives, Personal Care Ingredients, Feed Ingredients, Coating & Specialty Ingredients, Fine Ingredients & Additives.
Low demand due to economy slow down in Europe, as well as inflation in price of raw material has impacted sales and profit growth of Fine Organics adversely and hence its share is falling as well as entire chemical sector is on fall.
Fine Organic is sector leader in oleochemicals and demand of oleochemicals may increase in future with increase in customer awareness for natural, healthy and eco-friendly products. Further Fine Organic enjoys strong entry barrier due to stringent regulatory norms. On other hand Fine Organic has risk of inflation in prices of raw materials and consumer slow down. Based on this analysis investors may take their decision wisely as per their risk appetite.
Yes, Fine Organic is an Indian Company with its Headquarters at Mumbai in Maharashtra.
Oleochemicals are compounds derived industrially from vegetable oils or fats naturally and may be used as substitute of petroleum-based products or petrochemicals for raw materials or supplemental materials for variety of products such as cookie, cream, lipstick, chocolate, ice-cream, paint, adhesives, medicines & tyre.
In food oleochemicals introduces anti staling and anti-fungal properties which improves shelf life of the food such as bread, cakes and other bakery and dairy products. Oleochemicals also introduces crispiness and texture in food substances. In chocolates oleochemicals improves its visibility, smoothness and cream consistency.
In cosmetics oleochemicals improves consistency in creams, ointment and lotions.
In feed nutrition, oleochemicals are used as nutritional supplements that facilitates growth of birds and cattle.
Oleochemicals are used in Rubber industry as shoe lace, conveyor etc. Oleochemicals are also used in PVCs and other plastic products along with high quality safer plastic films used in packaging industry.
Oleochemicals are in compliance with Green Chemistry.
Oleochemicals are eco-friendly as they are biodegradable and derived from natural resources and hence oleochemicals are healthy, less toxic and less hazardous as well.
Oleochemicals can be produced by renewable feed stocks i.e. natural products which is sustainable while petrochemicals are produced by non-renewable resources such as fossil fuel which is not sustainable.
Oleochemicals are natural and less hazardous and less toxic than petrochemicals and other synthetic chemicals.
Due to these advantages of natural oleochemicals over synthetic chemicals, oleochemicals have strong and bright future perspectives in modern world as the awareness of natural products is increasing day by day.
Oleochemicals gets its utility over wide range of products and sectors such as cookie, cream, lipstick, chocolate, ice-cream, paint, adhesives, medicines & tyre which makes it very promising, evergreen and a high demand substance.
Investors may take their decisions wisely based on above mentioned moats and risks associated with Fine Organics on reasonable valuation i.e. P/E ratio when stock P/E falls on 3 to 5 years median P/E or at PEG ratio less than 1 is also considered as a good entry point.
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This is not an investment advice and the author is not SEBI registered, so investors must consult their professional financial adviser before making any investment of their hard-earned money in Stock Market as Stock Market is subjected to Market Risk.
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