Detailed Analysis on Diamines & Chemicals ltd.

 


Market Cap : 548 Cr

Current Price (16-04-2024) : 560

Sector : Chemicals

NSE/BSE : DIAMINESQ

About :

Diamines and Chemicals Ltd. was incorporated in the year 1976 and commenced its production in 1982. The company has been the sole manufacturer of Ethyleneamines in Indian subcontinent for more than two decades. This plant has been set up with total indigenous R&D and expertise and is placed among the select band of 6 to 8 companies worldwide who have proprietary technology for the manufacturing of Ethyleneamines.

Financial Metrics :

(source : screener.in)

  • Market Cap : 548 Cr
  • Current Price : 560
  • High / Low : 687 / 446
  • Book Value : 147
  • EPS : 24.90
  • Promoter Holding : 54.90 %
  • Pledged Percentage : 0.00 %
  • P/E Ratio : 22.50 (Industry PE : 33.20)
  • PEG Ratio : 0.58
  • Operating Profit Margin : 29.40 %
  • Return on capital employed (ROCE) : 48.40 %
  • Return on equity (ROE) : 36.00 %
  • Return on assets (ROA) : 32.30 %
  • Sales Growth 5Yr : 23.40 %
  • Profit Growth 5Yr : 38.80 %
  • Dividend Last Year : 6.00
  • Dividend Yield : 1.05 %
  • Debt : 0.18 Cr
  • Debt to Equity : 0.00
  • Debtor Days FY23 : 76
  • Current Assets : 71.60 Cr
  • Current Liabilities : 10.70 Cr
  • Free Cash Flow : 6.37 Cr
  • Net Cash Flow : 1.73 Cr

Please refer to this article for detailed explanation on above mentioned financial metrics

Earnings :

(source : screener.in)

Quarterly


Yearly

Good sales growth 
  • Over the last 5 years sales has grown at a yearly rate of  23 %
  • Over the last 3 years sales has grown at a yearly rate of  17 %
Good net profit growth
  • Over the last 5 years net profit has grown at a yearly rate of  39 %
  • Over the last 3 years net profit has grown at a yearly rate of  21 %
Good return on equity
  • ROE last year  36 %
  • Over the last 5 years ROE has grown at a yearly rate of  30 %
  • Over the last 3 years ROE has grown at a yearly rate of  28 %
Good return on capital employed
  • ROCE last year  48.40 %
  • Over the last 5 years ROCE has grown at a yearly rate of  41.20 %
  • Over the last 3 years ROCE has grown at a yearly rate of  35.60 %
Operating profit margin
  • Last Year OPM  51 %
  • 2022 OPM  33 %
  • 2021 OPM  40 %
Manufacturing Facility :





The company has been the pioneer and the only one in manufacturing of a range of Ethylene amines (EAs) in India. company's manufacturing facilities located at PCC Area, PO Petrochemicals, Vadodara, Gujarat. company has evolved products manufactured 'first time' in India and also pioneered to 'develop' a market for the same. over the years, the company has established its own presence in the market and is successfully catering to the needs of Industries.
The company's R & D Center is approved by DSIR, Government of INDIA. the center harbors a culture that foster innovation and helps shape inventions into innovative commercial products.
They are working on development of various new products as per customer requirement having applications in pharmaceuticals, polymer, agrochemicals, cosmetics, dyes, textile industries etc.

Facilities
  • Well equipped R & D laboratory
  • Well equipped analytical R & D laboratory
  • Hydrogenation reaction facility
  • Reaction scale-up & distillation facility
Products :
  1. Piperazine Anhydrous : Used as a raw material for the manufacture of quinolone drugs like Ciprofloxacin and Norfloxacin. Also used in manufacture of other drugs like Anti-helmintics, Sedatives, Antihistamines, Antifilarials, Tranquilizers, and Analgesics. Used for specialty chemicals and polymeric products like corrosion inhibitors, photographic chemicals, wetting agents, polyamides, rubber auxiliaries and hardener for epoxy resins and Gas sweetening.
  2. Ethylenediamine [EDA] : Used as raw material for Fungicide, Chelating Agent, Corrosion Inhibitor, Elastomeric Fibers, Textile Auxiliaries, Lube Oil and Fuel Additives, Water Treatment Chemicals, Drugs Intermediates, Plastic Additives, Polyamide Resins, Rubber Processing Additives, Paper Chemicals, Mining Chemicals.
  3. Diethylenetriamine [DETA] : Used as raw material for Asphalt Additives, Chelating Agent, Corrosion Inhibitors, Drainage Aids, Fabric Softeners, Lube Oil & Fuel Additives, Mineral Processing Aids, Polyamide Resins, Surfactants, Textile Additive, and Wet Strength Resin.
  4. Polyamine-Mix : Asphalt Additives, Corrosion Inhibitors, Epoxy Curing Agents, Hydrocarbon Purification, Lube Oil and Fuel Additives, Mineral Processing Aids, and Petroleum Production Chemical.
  5. Monoethanolamine [MEA] : MEA is mainly used for scrubbing acidic gases (H2S, CO2), detergent neutralizing and is also used as surface active agents, emulsifiers. As a solvent in pesticides.
  6. Triethylenediamine [TEDA] : Used extensively as a catalyst to promote both gelling and blowing reactions in the production of flexible, semi-rigid and rigid polyurethane foams, as well as, elastomers and adhesives. It is also used in polyurethane coating applications. Also used as a raw material for manufacture of agro-chemicals like herbicide and also in organic synthesis as acid absorber. TEDA is also available in solutions of dipropylene glycol and ethylene glycol.
  7. Piperazine 68% Solution 
  8. 1,2–Diaminopropane
  9. Dipropylene Triamine
  10. Diacetyl Ethylenediamine (DAED)
  11. Tetracetyl Ethylenediamine (TAED)
  12. Tetra methyl Ethylenediamine (TMEDA)
  13. Amine Mixture Used in CO2 Capture (gas sweetening & acid gas removal)
These products are used in various manufacturing industries such as Bulk Drugs (Quinolones, Antihistamines) to Fungicide – Insecticide, Polyamide resins, Gas Sweetening, Chelants, Textile Auxiliaries, Water Treatment Chemicals, Paints and Adhesives, Chemical Syntheses, Lube Oil Additives, etc.

On December 15, 2021, the company incorporated an Associate/Joint Venture Company, M/s KLJ Organic Diamines Limited. The shareholding ratio between M/s KLJ Organic Limited and the Company is 65:35 respectively.

It is one of the dominant suppliers of PIPERAZINE to pharmaceutical and gas sweetening application industries.

Industry Insights :

(source : zionmarketresearch.com)

Ethyleneamines

An organic substance called ethyleneamine is made up of ethylene links between amine groups. It is a clear, thick liquid with an ammonia-like smell. Strong bases like ethyleneamine can be utilized as chelating agents. Water may be easily combined with it. Moreover, it is soluble in hydrochloric acid, diluted nitric acid, and sulfuric acid. The market offers a variety of ethyleneamines, including piperazine, diethylenetriamine, ethylenediamine, triethylenetetramine, heavy polyamine, and tetraethylenepentamine.

In a wide variety of applications, ethylenediamine and diethylenetriamine are frequently employed as reactive intermediates to create additional beneficial compounds. It may be created via pressurized hydrogen reduction of aminoacetonitrile with nickel suboxide. The reaction of ethanolamine with ammonia in the presence of a nickel catalyst is a different way to make ethanolamine. The typical reaction of ethyleneamines with moisture in the presence of air produces fumes that are harmful to human health and corrosive to metals.
  • The global ethyleneamines market is estimated to grow annually at a CAGR of around 5.2% over the forecast period (2023-2030).
  • In terms of revenue, the global ethyleneamines market size was valued at around USD 1.9 billion in 2022 and is projected to reach USD 2.9 billion, by 2030.
  • The ethyleneamines industry is expanding as a result of its adoption in the pharmaceutical sector.
  • Based on the type, the Ethylenediamine (EDA) segment is expected to dominate the market during the forecast period.
  • Based on the application, the resins application segment is expected to hold the largest market share during the forecast period.
  • Based on the industry vertical, The adhesives and paints & coatings segment is projected to grow substantially over the forecast period.
  • Based on region, the Asia Pacific is expected to dominate the market during the forecast period.
Pros :
  1. Company with no debit
  2. Company with good promoter holding and zero promoter pledge
  3. Generating good ROCE, ROE, ROA
  4. Last 5 years profit growth at 38.80 %
  5. Company is maintaining healthy dividend payout
  6. Positive free cash and net cash flow
  7. Stock PE is less than industry PE
Cons :
  1. For the past three quarters profits are declining
  2. For the past five quarters operating profit margins are declining
This is not a buy/sell advice I am not SEBI registered, just providing basic details regarding this company from various sources available online, please do your own research or consult a SEBI registered investment advisor before taking any investment decision.

Thank You for reading this article if you liked this one please visit next week again for analysis on another new stock.

Comments

Post a Comment