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Heubach Colorants India is a Mumbai-based company operating in the dyes & pigments segment and has a market capitalisation of Rs 1,178 crore. The little-known company is not tracked by any analyst or brokerage firm but that has not stopped Quant Mutual Fund from buying a 0.51 percent stake in the company through a bulk deal.
Shares of the listed entity closed nearly 18 percent higher at Rs 508 on Friday, June 21, a day after the fund house bought around 1.20 lakh shares of the company at a price of Rs 453.57 per share.
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Heubach Colorants India is a globally recognized leader in pigments and pigment preparations, catering to diverse industries such as coatings, plastics, inks, and cosmetics. Industry peers include Gujarat Fluorochemicals, Aarti Industries, and Vinati Organics.
Also read: Bulk deals: Quant Mutual Fund buys 0.51% in Heubach Colorants Ind
Market participants are of the view that the investment reflects investor confidence in Heubach’s robust growth potential and market position.
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“In the competitive colorants industry, Heubach Colorants stands out not only for its innovative products but also for its strong valuation relative to peers, underlining its leadership and financial stability,” said Atul Parakh, CEO of trading platform Bigul.
In October 2022, Clariant Chemicals was renamed Heubach Colorants after Clariant completed the sale of its pigments business to a consortium of Heubach Group and SK Capital Partners. Over the last year, the stock for Heubach Colorants has gained 38.3 percent. In April 2024, sister company Heubach GmbH, the second-largest pigments player globally, filed for bankruptcy in Germany. Both firms are part of the Heubach group.
Strong Financials
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The company reported strong earnings with revenue for FY2024 pegged at Rs 799.4 crore against Rs 771.8 crore, a 3.8 percent YoY growth. On a sequential basis, revenue for the company rose 18.7 percent to Rs 210.3 crore. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin for the same period has grown 1.5 percent YoY to 10.27 percent.
The company has a market cap of Rs 1,177 crore and a PE of 24.29x. In a release post the Q4 earnings, Bharath Sesha, MD, Heubach Colorants India (HCIL), said that they expect FY2025 to gain momentum as the year progresses, with a weaker first half building to a strong second half.
“The medium- to long-term outlook for HCIL remains positive, driven by our focus on innovation, operational excellence, and profitable growth,” he said.
Interestingly, Quant MF has been quite active of late, picking up stakes in a variety of stocks over the last three months, including Ador Welding (2.7 percent on June 11), Om Infra (1.75 percent on June 11), and Aarti Pharmalabs (1.16 percent on May 22).
The fund house currently has an AUM of around Rs 65,942.93 crore.
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