Adani Wilmar Limited (AWL) has notified the exchanges about the successful completion of the acquisition of a 67% stake in Omkar Chemical Industries Private Limited (OCIPL). This marks a significant move in its business growth. AWL has positioned itself to strengthen its presence in the specialty chemicals sector. This acquisition is a key milestone for AWL as it diversifies its operations and taps into new market opportunities.
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Table of Contents
Company Overview
Adani Wilmar Limited is a joint venture between Adani Enterprises and Wilmar International. It was founded in 1999. It is a major player in the Indian food and beverage industry. It is India’s largest processor of palm oil and has diversified into various segments, including edible oils, foods, and now specialty chemicals.
Facts to know about the specialty chemical sector
The specialty chemicals market in India is experiencing rapid growth, with the industry projected to expand at a CAGR of over 12% from 2020 to 2025. This growth is fueled by strong demand from end-user sectors like food, automobile, real estate, and cosmetics. The market, valued at USD 32 billion, represents 22% of India’s overall chemicals and petrochemicals market and accounts for over 50% of all chemical exports. Indian manufacturers have benefited from low-cost production, abundant manpower, and supportive government policies like the PCPIR and PLI schemes.
As global manufacturers face higher costs and stricter regulations elsewhere, India is becoming an attractive alternative for specialty chemicals production. The Indian market is poised for substantial growth as companies focus on research and development, capital investments, acquisitions, and expanding the domestic market. Investor confidence and strategic corporate spending will be crucial in driving sustainable growth in the industry.
AWL’s entry into this market aligns with these industry trends, positioning the company to capitalize on future growth opportunities.
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Stock Performance
Key Financial Metrics
Metric | Value |
---|---|
Market Capitalization | ₹ 47,217 Cr. |
Price to Earnings (P/E) | 73.63 |
Industry P/E | 35.4 |
Price to Book Value (P/BV) | 5.71 |
Industry P/BV | 2.86 |
Return on Equity (ROE) | 3.65% |
Debt to Equity | 0.29 |
Return on Capital Employed (ROCE) | 10.4% |
Return on Assets (ROA) | 1.54% |
Dividend Yield | 0.00% |
Profit After Tax (PAT) Quarterly | ₹ 324 Cr. |
PEG Ratio | -17.2 |
Sales Growth | -5.61% |
Profit Growth | 72.9% |
Enterprise Value | ₹ 46,916 Cr. |
Adani Wilmar Ltd has a market capitalization of ₹47,217 crore and a Price to Earnings (P/E) ratio of 73.63, which is significantly higher than the industry average P/E of 35.4. This indicates that the company may be valued more expensively compared to its peers.
The Price to Book Value (P/BV) ratio stands at 5.71, also higher than the industry average of 2.86, suggesting that the market perceives the company as having a strong asset base relative to its book value. Despite this, the Return on Equity (ROE) is relatively low at 3.65%, which might imply that the company is not generating high returns on its equity.
The company maintains a low Debt to Equity ratio of 0.29, indicating a conservative use of debt.
The Profit After Tax (PAT) for the quarter is ₹324 crore. The company has a negative PEG ratio of -17.2, indicating that its earnings growth may not justify its current valuation. The sales growth is negative at -5.61%, but profit growth is strong at 72.9%, indicating an improvement in profitability.
Share Holding Pattern
Category | June 2024 |
---|---|
Promoters | 87.88% |
FIIs (Foreign Institutional Investors) | 0.73% |
DIIs (Domestic Institutional Investors) | 0.25% |
Public | 11.15% |
Number of Shareholders | 11,61,453 |
Disclaimer: This information is for educational purposes only and does not constitute financial advice. Always conduct your own research and consult with financial professionals before making investment decisions.