Himadri Speciality Chemical shares slip over profit booking, but long-term gains remain strong

Himadri Speciality Chemical shares are seeing a price correction due to profit booking at higher levels after delivering strong multi-year returns. Over the last six months, the stock gained 40 percent while the benchmark Sensex dropped 5 percent. Over three and five years, it delivered multibagger returns of nearly 160 percent and 1,210 percent respectively. However, the stock is down more than 2 percent in October following a 3 percent rise in September. Shares hit a 52-week high of 819.50 rupees on 21 July this year after dropping to a 52-week low of 420 rupees on 24 November last year, and rose nearly 1 percent in intraday trade on Wednesday, 14 October.

Growth Plans

The company is targeting to double its profit after tax to over 1,100 crore rupees by financial year 2028. It is moving from a traditional coal tar derivative manufacturer into an advanced materials powerhouse. Plans include building a 100 GWh battery materials facility for cathode and anode parts used in electric vehicles, which is expected to generate 30,000 crore rupees in extra revenue over five years.

Expert Views

Ravi Singh of Master Capital Services notes the stock trades around 41 times P/E and suggests investors can consider buying near 630 rupees based on risk. Vinit Bolinjkar of Ventura states the firm has solid cash flows, operating margins of 19 to 21 percent, and a return on capital employed above 20 percent. Bolinjkar advises current holders to stay invested for battery component growth and buyers to use staggered purchases during pullbacks.

Context

Stock price corrections often follow rapid upward movements as early investors lock in their gains. Transitioning into electric vehicle supply chains represents a major shift for industrial chemical manufacturers seeking high-margin growth sectors.