Fairchem Organics jumps 7% despite muted Q4 results

Shares of Fairchem Organics jumped nearly 7 percent in morning trade on May 31, despite the company reporting a lacklustre set of earnings for the March quarter. At 11:27 am, shares of the company were trading 7.25 percent higher at Rs 1,239 on the NSE.

Fairchem, the manufacturer of Dimer acid and Linoleic Acid used in many consumer products including paints and printing ink, posted net profit of Rs 11.86 crore for the fourth quarter, up 5.48 percent YoY.

The financials

Its revenue from operations came in at Rs 151.50 crore as against Rs 177.36 crore in the fourth quarter of FY22. The total income for the quarter was at Rs 152.06 crore, while total expenses during the period was at Rs 136.11 crore.

On an annual basis, the revenue of the company flat lined at Rs 646.94 crore for FY23, compared to Rs 642.28 crore last year. Net profit after tax declined by 6 percent YoY to Rs 435 crore in FY23, as against Rs 679 crore in the previous year.

Fair Chem’s earnings per share (EPS) increased to Rs 9.11 in March 2023 from Rs. 8.63 in March 2022. However, for FY23 the EPS declined to Rs 33.41 from Rs 52.15.

The board of directors of the company have recommended dividend of 75 percent at Rs 7.50 per share on face value of Rs 10 per share, which is subject to approval from the shareholders in the ensuing annual general meeting.

The stock has declined 18.02 percent over the last six months, and 6.20 percent over the last year to date.

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