DHARAMSI MORARJI CHEM.(506405) - VALUE BUY

Today I am expressing my view on one Speciality chemical stock.

DHARAMSI MORARJI CHEM.(506405)

The Dharamsi Morarji Chemical Co. Ltd., (DMCC) headquartered in Mumbai (India), is an ISO 9001:2008 accredited organization. Established in 1919, DMCC was the first producer of Sulphuric Acid and Phosphate fertilizers in India. Over the years, the brand of the Company ("Ship") came to be recognized as the quality standard for Single Superphosphate (SSP). Today, DMCC is one of the leading chemical companies in India.

With focused Research and Development efforts, processes for downstream sulphur-based chemicals were commercialized. What is visible now is a culmination of efforts by the entire team: sustainable performance with zero dependence on Government policy, net foreign exchange earnings, and sales to over 25 countries in 5 continents.

DMCC offers customized products and thoughtful solutions to our global customers.

DMCC take pride in maintaining healthy relationship with the environment. We extend our responsibility to the society and focus on sustainable development.

Core Technology

• Sulfonation & Sulfation
• Chlorosulfonation
• Friedel Craft Reaction
• Esterification
• Methylation
• Ethylation

Markets By End-Use

• Textile Processing
• Emulsions
• Polymers (PEEK)
• Dyes & Pigments
• Pharmaceuticals Intermediates
• Electroplating
• Thermal Paper Coating
• Fire Retardants
• Agro-Chemicals
• Water Treatment
• Fertilizers
• Cosmetics

CUSTOM TECHNOLOGY

DMCC has nearly 100 years of experience in handling hazardous chemicals. Our proven ability to safely and responsibly handle hazardous chemicals has resulted in customers approaching us as a preferred supplier of custom and toll manufacturing services. Our array of chemical processing equipment and process expertise can help to reduce cost and shorten product development cycle. Apart from manufacturing as per specifications given by customers, DMCC also undertakes toll manufacturing (where the customer supplies raw materials and process details) and process development. DMCC recognizes the need for confidentiality and non-disclosure agreement are adhered to.

With the installation of multipurpose manufacturing facilities in 2005, DMCC could cater to changing customer requirements, as well as low volume high value products. Dedicated manufactturing plants for regular products are based on continuous processes, while multipurpose plants are based on batch processes. Kilo-to-ton lots are available at short notice for seed marketing and application development. A wide temperature range, vacuum, and a different materials of construction are available.  Several different unit operations are possible.

Some of the chemical reactions undertaken are:

• Chlorosulphonation
• Sulphonation
• Ethylation
• Methylation
• Esterification

Actual work starts only after signing confidentiality agreements. DMCC undertakes those processes where in-house knowledge and expertise can give an edge to their customer, either in terms of cost or finished product characteristics. In most cases, norms established at customers laboratories are improved at the plant scale. While most of the Service business carried out by DMCC is still for sulphur and ethanol based chemicals, other processes are growing as well.

TECHNOLOGY

The main focus of DMCC is on Sulfur and Ethanol Chemistry. All our products are based on processes developed by in-house R & D Division. We are an ISO 9001:2008 company since 1997. We offer process design, engineering package, procurement assistance and commissioning of plants for the following products:

• Sulfuric Acid
• Oleum
• Single Superphosphate
• Alumina Sulfate
• Sulfamic Acid
• Dimethyl Sulfate
• Chlorosulfonic Acid

Features

• High Energy Recovery from waste heat
• Low Operating Cost
• Low emissions
• Complete Automation

Milestones

• DMCC has designed and commissioned over 50 Sulphuric Acid Plants from 50 TPD to 1350 TPD in India, Middle, Far-East and South Africa
• DMCC has designed and commissioned Single Super Phosphate Plants from 50 TPD to 1000 TPD
• Experience in designing building and operating plants

Company shares are trading in BSE. Promoter holding in the company is 50.6% ( Increased from last qtr)

Company posted 31Cr top line with over 23 % operating margin & Net profit is 3.6 Cr in the Dec qtr.

Stock is trading low PE of 14 against its peers, industry PE is 24.

Stock is trading at Rs 102.

As the company is pioneer in sulfur and its compounds, speciality chemical sector growing exponentially this stock will give good returns to investors in near to long term.

NOTE : THE ABOVE IS NOT A RESEARCH REPORT NOR A RECOMMENDATION  BUT INFORMATION AS AVAILABLE ON PUBLIC DOMAIN. 

Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”