DUCOL - Ducol Organics

📊 NSE: DUCOL 🏢 Dyes And Pigments 📅 Last Updated: 12/13/2025 21:41

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue reached INR 64.52 Cr in H1 FY26, driven by the core dispersion business and the newly acquired Bitumag waterproofing segment. Standalone revenue for FY25 was INR 77.35 Cr, a 2.58% increase from INR 75.41 Cr in FY24, primarily impacted by passing on lower raw material costs to customers.

Geographic Revenue Split

The company serves the entire Indian market with a presence across diverse industrial hubs. Specific percentage splits per region are not disclosed, but operations are centered around manufacturing facilities in Taloja and Mahad, Maharashtra.

Profitability Margins

Standalone Net Profit Margin declined from 6.37% in FY24 to 5.98% in FY25. Consolidated PAT margin for H1 FY26 stood at 4.37%, compressed by one-time acquisition costs and higher interest outgo.

EBITDA Margin

Standalone EBITDA margin improved slightly from 9.22% in FY24 to 9.42% in FY25 (INR 7.28 Cr). Consolidated EBITDA margin for H1 FY26 was 8.98% (INR 5.80 Cr), reflecting the initial integration phase of Bitumag.

Capital Expenditure

The company commissioned a second manufacturing line at the Bitumag facility in H1 FY26, doubling its capacity. Total assets increased to INR 164.52 Cr as of September 2025 from INR 135.62 Cr in March 2025, including INR 23.10 Cr in Goodwill from the acquisition.

Credit Rating & Borrowing

Consolidated debt stood at INR 27.31 Cr as of March 31, 2025, with a debt-to-equity ratio of 0.30. The company incurred INR 1.02 Cr in additional finance costs during H1 FY26 specifically for acquisition-related borrowings.

⚙️ Operational Drivers

Raw Materials

Key raw materials include pigments for the core dispersion business and bitumen (polymer-modified, emulsion, and multigrade) for the construction chemicals segment. Raw material costs accounted for 65.5% of revenue in FY25 (INR 50.68 Cr) and 69% in H1 FY26 (INR 44.54 Cr).

Import Sources

Not specifically disclosed, though the company monitors global market prices and foreign exchange rates for procurement.

Capacity Expansion

Doubled capacity at the Bitumag facility by adding a second manufacturing line during H1 FY26. The company operates three existing plants (two in Taloja, one in Mahad) for its core dispersion products.

Raw Material Costs

Raw material costs were INR 50.68 Cr in FY25, up 4.86% from INR 48.33 Cr in FY24. In H1 FY26, raw material expenses were INR 44.54 Cr, representing a significant portion of the consolidated expenditure.

Manufacturing Efficiency

Current capacity utilization post-expansion stands at 30-35% as of H1 FY26, with management expecting a gradual increase as synergies with existing clients are realized.

Logistics & Distribution

Not disclosed as a specific percentage of revenue.

📈 Strategic Growth

Expected Growth Rate

66%

Growth Strategy

Growth is targeted through the integration of Bitumag Industries, enabling entry into the waterproofing and construction chemicals market. The strategy involves cross-selling these new products to Ducol's existing client base in the paints and infrastructure sectors and increasing capacity utilization from the current 30-35%.

Products & Services

Pigment dispersions, masterbatches, paste colorants, polymer-modified bitumen, emulsion bitumen, and multigrade bitumen for waterproofing and construction.

Brand Portfolio

Ducol, Bitumag.

New Products/Services

Waterproofing and construction chemicals added via Bitumag acquisition; expected to contribute significantly as utilization scales up from 30-35%.

Market Expansion

Expanding into the non-pigment dispersion space (waterproofing) and targeting the growing residential construction and infrastructure sectors in India.

Strategic Alliances

Acquisition of Bitumag Industries Pvt. Ltd. completed in H1 FY26.

🌍 External Factors

Industry Trends

The pigment and dispersion industry is seeing a recovery driven by the paints and coatings sector. The global dispersion market is expanding, and Ducol is positioning itself in the high-performance construction chemicals niche to capture this growth.

Competitive Landscape

Faces competition from both domestic and multinational companies; differentiates through product quality, innovation, and long-term client relationships.

Competitive Moat

Moat is built on 30 years of expertise in pigment chemistry, integrated manufacturing facilities, and a long-standing client base. The acquisition of Bitumag adds a specialized technological moat in bitumen-based dispersions.

Macro Economic Sensitivity

Sensitive to the Indian real estate and infrastructure sectors; global economic growth projections of 3.1% to 3.2% for 2024-2025 influence overall demand.

Consumer Behavior

Increased demand for durable, high-performance solutions in infrastructure and home remodeling is driving the shift toward specialized construction chemicals.

Geopolitical Risks

Exposure to global supply chain fluctuations and market price changes for financial instruments.

⚖️ Regulatory & Governance

Industry Regulations

Complies with SEBI (LODR) Regulations, Companies Act 2013, and labour/tax laws. Voluntarily adopted IND-AS for financial reporting despite being in an exempted category.

Environmental Compliance

Not disclosed in absolute INR values.

Taxation Policy Impact

Effective tax rate was approximately 25.3% in FY25 (INR 1.57 Cr tax on INR 6.20 Cr PBT).

Legal Contingencies

The company uses stringent contractual terms to restrict liabilities; no specific pending high-value court cases were mentioned in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

Integration risk of the Bitumag acquisition and the ability to scale capacity utilization from 30% to optimal levels could impact projected profitability by 10-15%.