Camlin Fine Sciences sees 51% surge in shares amid anti-dumping duties on Chinese Vanillin

Synopsis

Camlin Fine Sciences' shares have jumped due to anti-dumping duties on Chinese manufacturers by the US and EU, benefiting its aroma exports, particularly vanillin. The company plans to increase vanillin capacity utilization, aiming for higher revenue and improved EBITDA margins. Brokerages have raised valuations, citing growth potential and a better debt position, leading to a significant stock increase.

ET Intelligence Group: Shares of Camlin Fine Sciences, a manufacturer and exporter of specialty chemicals, have surged nearly 51% over the past month amid anti-dumping duties imposed by the US and the European Union (EU) on Chinese manufacturers.

The move is expected to benefit the company's aroma exports business over the next three-four quarters. However, investors should remain cautious, as sustaining such returns will depend on the company's ability to deliver strong financial performance in the medium term.

The EU imposed anti-dumping duties of 131.1% on imports of vanillin, an organic compound, originating in China following a similar move by the US last year. These actions have driven up vanillin prices in both regions, which are significant export markets for Camlin.

Camlin's business involves manufacturing, marketing, and supply of specialty chemicals used across various industries-including food, animal feed, pet nutrition, fragrance, pharmaceuticals, and industrial products. Its blends and aroma businesses, which include vanillin, were the primary drivers of growth in the previous financial year.

Agencies

The blends segment generated ₹878 crore in revenue in FY25 up from ₹747 crore in the previous financial year while revenue from the aroma ingredients segment surged to ₹176 crore from ₹35 crore in FY24. Total revenue improved by 15% to ₹1,666.5 crore for FY25.

Buoyed by the increase in the prices, the company plans to increase its vanillin capacity utilisation from the current 45-50% to 100% over the next two years that would lead to lower cost per unit.

"We should grow blends business by about 20% in the next two to three years and the Ebitda margins will improve in some of the geographies. So it will be in the high teens," Nirmal Momaya, managing director, Camlin Fine Sciences told analysts during an earnings call. The company's Ebitda margin was 12.5% in FY25 compared with 12.6% in the previous year.

The company's net debt declined to ₹492 crore as of March 2025 from ₹564 crore a year ago, improving the net debt-to-equity ratio to 0.5 from 0.7.

Higher growth potential and improved debt position has prompted brokerages to raise the company's valuations. "We raise the valuation multiple to 15 times FY27 expected earnings (previously 12 times) to reflect the anticipated improvement in performance due to increasing share of high margin blends, rising vanillin prices, and improving profitability," said Axis Securities in a report.

The stock was ended at ₹300 on Wednesday on the BSE, reflecting 182% jump from the year-ago level.

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