In one year, the company's shares have risen from ₹ 816.05 to ₹ 2,619.90 (current market price), representing a multibagger return of 221.05%

Gujarat Fluorochemicals Ltd (GFL) is a specialised chemical company with a market capitalization of ₹ 28,779 crore. The firm is a prominent manufacturer of Fluoropolymers, Fluorospecialties, Refrigerants, and Chemicals, with a broad range of Fluoropolymers such as PTFE, PFA, FEP, FKM, PVDF, and Fluoropolymer Additives. In one year, the company's shares have risen from ₹ 816.05 to ₹ 2,619.90 (current market price), representing a multibagger return of 221.05 percent.

The company reported a net revenue from operations of ₹ 1,052.97 crore in March 2022, up 35.6 percent YoY from ₹ 776.55 crore in March 2021, and EBITDA of ₹ 329.60 crore in March 2022, up 83.03 percent from ₹ 180.07 crore in March 2021. Gujarat Fluoro's earnings per share (EPS) grew to Rs. 20.11 in March 2022 from Rs. 9.19 in March 2021, while quarterly net profit increased by 118.84 percent to Rs. 220.94 crore in March 2022 from Rs. 100.96 crore in March 2021. The Board of Directors has recommended a final dividend of 200%, or Rs. 2 each equity share with a face value of Rs. 1 each, for the financial year 2021-22, subject to the approval of shareholders.

Gujarat Fluorochemicals Ltd planned capex towards expanding its capacities for fluoropolymers, new age products and battery chemicals is progressing well as per the schedule. It intends to commission 3 new plants by Q1FY23 which got delayed due to supply chain issue in Q4FF22. Increasing in demand for FKM, PVDF and Micro Powders is expected to be met with additional capacities expected to be commissioned over the next 2 quarters, added the brokerage firm KRChoksey.

“We believe GFL is poised for growth in the coming quarters backed by expansion in capacity of its new fluoropolymer business in addition with increasing utilisation levels and revenues from R125 and R142B. Also robust demand for its PTFE product supported by its integrated plant operations should offer better realisations in the coming quarters thus improving the return ratios and keep the momentum of its financial performance intact. Since our last recommendation the stock has already achieved our target price (INR 3,167). At present it provides a good opportunity to re-enter the stock as it is trading at INR 2,495 with a P/E multiple of 29.19x/24.06x FY23E/24E to its earnings. We continue to maintain ‘BUY’ recommendation on the stock and apply P/E multiple of 31x to its FY24E earnings, which yields an increased revised target price of INR 3,215 per share," the brokerage has said in a report.

The stock closed at ₹ 2,619.90 today, up 5.00 percent from its previous closing of ₹ 2495.15. The stock has moved to its 52-week high of ₹ 3,198.90 on 4th February 2022 and a 52-week low of ₹ 809.55 on 18th May 2021, implying that it is now trading 18% below its 52-week high. The stock is now trading higher than the 5 day, 10 day, 12 day, 20 day, 100 day, and 200 day moving averages, but lower than the 26 day and 50 day moving averages.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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