Fairchem Organics Ltd (FAIRCHEMOR) AI Stock Analysis

• Market Cap: ₹6.52B
• Dividend Yield: 1.07%
• Average Volume (3M): 1.36K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.01
• Revenue Growth: -22.10%
• EPS Growth: -85.56%
• Country: IN
• Employees: 227
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): -0.07
• Shares Outstanding: 12,595,902
• 10 Day Avg. Volume: 3,155
• 30 Day Avg. Volume: 1,356
• PEG Ratio: -1.15
• Price to Book (P/B): 3.84
• Price to Sales (P/S): 2.16
• P/FCF Ratio: -24.96
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 47 Neutral
• Price Target: ₹510.00 ▼(-33.43% Downside)
• Action: Reiterated Date: 11/19/25
• Date: Action: Reiterated 11/19/25

Fairchem Organics Ltd faces significant challenges with financial performance and technical indicators both pointing to weaknesses. The high P/E ratio suggests overvaluation, adding to the risk profile. The lack of positive earnings call data or corporate events further underscores the need for caution.

Positive Factors

Specialty oleochemicals business model

Fairchem's focus on converting natural oils into specialty oleochemicals and performance chemicals places it in higher value‑added industrial segments. This product-oriented model supports customer stickiness, differentiated margins and durable demand patterns versus commodity chemical cycles.

Diversified revenue streams (manufacturing + trading)

The mix of manufacturing-led sales and trading/distribution provides operational flexibility and revenue diversification. Manufacturing supports higher-margin specialty sales while trading can smooth near-term volume swings, helping stability of cash flow and reducing dependence on a single channel.

Strong equity base / balance sheet

A 75.2% equity ratio indicates substantial capitalization and an ample buffer against shocks. This balance-sheet strength enhances resilience, preserves strategic optionality for investments or working-capital needs, and reduces near-term solvency risk compared with highly leveraged peers.

Negative Factors

Declining revenue and compressed margins

A double-digit revenue decline and narrower gross and net margins point to weakening demand, pricing pressure, or rising input costs. Sustained top-line contraction with margin compression undermines scale economics and makes long-term margin recovery and free cash generation more difficult.

Weak cash generation

Negative operating cash flow and a sharp fall in free cash flow indicate poor cash conversion of earnings. Over a multi-month horizon, weak cash generation limits reinvestment capacity, increases reliance on external financing, and raises liquidity and refinancing risks for operations and growth.

Rising leverage and lower shareholder returns

An increased debt burden alongside ROE slipping to 7.3% reduces financial flexibility and shareholder returns. Higher leverage amplifies interest-cost sensitivity and constrains capital allocation choices, making it harder to pursue strategic investments without further stress on profits and cash flow.

Fairchem Organics Ltd Business Overview & Revenue Model

Company Description

Fairchem Organics Limited manufactures and sells specialty oleo chemicals and intermediate nutraceuticals in India, East Asia, the Middle East, North America, and South America. It provides nutraceuticals comprising natural and mixed tocopherol and sterol concentrates; and oleo chemicals, such as dimer, monobasic, linoleic, monomer, palmitic, and distilled fatty acid products, as well as residues. The company was incorporated in 2019 and is based in Ahmedabad, India.

How the Company Makes Money

Fairchem Organics makes money primarily by selling specialty chemical products derived from natural oils and related raw materials. Its key revenue streams include: (1) manufacturing-led sales, where the company processes input oils/feedstocks into higher-margin oleochemical/performance-chemical outputs and sells them to industrial customers (revenue recognized from product shipments/contracts with customers); and (2) trading/distribution income, where it buys and sells certain chemical products as a distributor/trader, earning a gross margin on resale (and in some cases service income linked to distribution). Earnings are influenced by factors such as demand from end-use industries, product mix (higher value-added specialty products vs. commodity-like items), plant utilization, and the spread between raw material costs and realized selling prices (which can be volatile for natural-oil-linked feedstocks). Specific, named major customers, contract structures, or partnership details are null.

Fairchem Organics Ltd Financial Statement Overview

Summary

Fairchem Organics Ltd is experiencing financial stress with declining revenue, profitability, and cash flow metrics. Despite a robust balance sheet, increasing leverage and reduced returns are concerns. Operational inefficiencies and cash flow issues need addressing.

Income Statement

Fairchem Organics Ltd has shown a significant decline in key profitability metrics over the last year, with the gross profit margin falling to 12.4% from previous highs. The net profit margin decreased to 4.1%, indicating challenges in maintaining profitability. Revenue growth is negative, with a 13.4% decrease from the previous year. The EBIT and EBITDA margins have also declined, reflecting operational inefficiencies.

Balance Sheet

The company maintains a solid balance sheet with a healthy equity ratio of 75.2%, suggesting strong financial stability. However, the debt-to-equity ratio has increased, signaling a rise in leverage. The return on equity (ROE) dropped to 7.3%, indicating reduced shareholder returns.

Cash Flow

Cash flow performance has weakened considerably, with a significant drop in free cash flow and a negative operating cash flow. The free cash flow to net income ratio is negative, highlighting cash flow challenges. The operating cash flow to net income ratio turned negative, underlining issues in cash generation relative to net income.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	4.77B	5.38B	6.21B	6.47B	6.42B	3.96B
Gross Profit	702.48M	666.52M	1.54B	1.56B	1.78B	1.25B
EBITDA	228.90M	441.21M	681.10M	729.68M	1.05B	688.05M
Net Income	60.57M	219.74M	405.00M	435.01M	679.06M	424.85M
Balance Sheet
Total Assets	3.88B	4.02B	3.34B	3.42B	3.24B	2.59B
Cash, Cash Equivalents and Short-Term Investments	13.12M	12.86M	84.00K	838.00K	83.00K	460.00K
Total Debt	544.04M	630.32M	73.18M	501.68M	620.30M	568.03M
Total Liabilities	943.42M	997.98M	443.77M	831.48M	919.26M	898.68M
Stockholders Equity	2.94B	3.02B	2.90B	2.59B	2.32B	1.69B
Cash Flow
Free Cash Flow	198.36M	-464.87M	563.52M	348.89M	58.91M	163.03M
Operating Cash Flow	306.58M	-203.78M	744.80M	496.15M	404.85M	394.26M
Investing Cash Flow	-106.46M	-255.71M	-176.25M	-144.92M	-341.84M	-228.02M
Financing Cash Flow	-200.08M	459.49M	-568.55M	-351.24M	-63.19M	-166.29M

Fairchem Organics Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 766.10
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:FAIRCHEMOR, the sentiment is Negative. The current price of 766.1 is above the 20-day moving average (MA) of 583.41, above the 50-day MA of 640.36, and below the 200-day MA of 768.35, indicating a bearish trend. The MACD of -26.21 indicates Positive momentum. The RSI at 32.98 is Neutral, neither overbought nor oversold. The STOCH value of 10.95 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:FAIRCHEMOR.

Fairchem Organics Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INDOAMIN	63 Neutral	₹6.76B	19.71	―	0.38%	13.01%	32.44%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
JAYAGROGN	60 Neutral	₹8.11B	22.24	―	1.23%	0.69%	-7.54%
AMNPLST	60 Neutral	₹7.99B	33.58	―	0.26%	-4.07%	-12.36%
MANALIPETC	54 Neutral	₹7.68B	3.95	―	0.82%	-2.41%	178.19%
FAIRCHEMOR	47 Neutral	₹6.52B	-2,425.33	―	1.07%	-22.10%	-85.56%
VALIANTORG	46 Neutral	₹5.73B	52.56	―	―	16.43%	―