FINEORG - Fine Organic

📊 NSE: FINEORG 🏢 Chemicals 📅 Last Updated: 12/13/2025 22:05

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue from operations grew 6.89% YoY to INR 2,269.15 Cr in FY25 from INR 2,122.95 Cr in FY24. Standalone revenue grew 13.02% YoY to INR 2,205.19 Cr. H1FY26 standalone revenue showed a 2.5% YoY growth to INR 1,131.1 Cr.

Geographic Revenue Split

Exports accounted for 55% of total revenue in Q2FY26 and H1FY26, while domestic sales contributed the remaining 45%. This split highlights the company's significant reliance on global markets for its oleochemical additives.

Profitability Margins

Standalone Net Profit Margin dipped to 17.67% in FY25 from 18.49% in FY24. Standalone Operating Profit Margin stood at 19.41% in FY25, down from 21.62% in FY24, primarily due to changes in pricing and product mix. Standalone Gross Profit Margin for H1FY26 was 37.1%, down from 41.3% in H1FY25.

EBITDA Margin

Standalone EBITDA margin for FY25 was 21.8%. For Q2FY26, the EBITDA margin was 18.9%, a significant decline from 24.0% in Q2FY25, reflecting a 24.3% YoY drop in EBITDA to INR 108.3 Cr due to rising raw material costs.

Capital Expenditure

The company has planned a capital outlay of INR 700 - 750 Cr between FY26 and FY28 for a new manufacturing facility under its subsidiary, Fine Organic Industries (SEZ) Private Limited. Additionally, it is finalizing plans for a manufacturing plant in the USA.

Credit Rating & Borrowing

The company maintains a strong credit profile and is currently debt-free with a debt-equity ratio of 0.00. Interest coverage ratio improved to 284.63 in FY25 from 207.20 in FY24, reflecting stable earnings and minimal finance charges of INR 2.20 Cr (consolidated).

⚙️ Operational Drivers

Raw Materials

Key raw materials include vegetable oil and its derivatives, which represent the bulk of the INR 1,331.8 Cr raw material cost in FY25 (approx. 60.4% of standalone revenue).

Import Sources

Approximately 70-75% of raw materials are procured from the domestic market (India), while 30-35% are imported from international markets.

Capacity Expansion

Current capacity is supported by facilities at Ambernath and Patalganga. Planned expansion includes a new plant in India (SEZ) with a INR 700-750 Cr outlay and a new manufacturing plant in the USA under Fine Organics Americas LLC.

Raw Material Costs

Raw material costs for H1FY26 rose to INR 711.2 Cr from INR 647.6 Cr in H1FY25, a 9.8% increase. Procurement strategies involve a mix of short and medium-term contracts to manage vegetable oil price volatility.

Logistics & Distribution

Freight costs remained stable throughout H1FY26, supporting export operations which comprise 55% of revenue.

📈 Strategic Growth

Growth Strategy

Growth will be achieved through a INR 700-750 Cr domestic SEZ expansion and the establishment of a manufacturing plant in the USA (Fine Organics Americas LLC). These moves aim to increase capacity and reduce lead times for the 55% export market.

Products & Services

The company sells over 450 specialized oleochemical-based additives used in multiple industries including food, plastics, cosmetics, and coatings.

Brand Portfolio

Fine Organics.

Market Expansion

Targeting the North American market through the incorporation of Fine Organics Americas LLC and expanding domestic export capacity via the SEZ unit by FY28.

Strategic Alliances

Joint ventures include Fine Zeelandia Private Limited and Fine Organic Industries (Thailand) Co., Ltd.

🌍 External Factors

Industry Trends

The industry is seeing stable demand for green, vegetable-based additives. Fine Organics is positioning itself by expanding manufacturing footprints in the USA and India to meet this global demand.

Competitive Moat

The moat is built on a vast portfolio of 450+ products and strong process innovation. This technical expertise and long-standing supplier relationships (70-75% domestic RM) provide a durable competitive advantage.

Macro Economic Sensitivity

Highly sensitive to global vegetable oil price fluctuations, which dictate product pricing and raw material costs (INR 1,331.8 Cr in FY25).

Consumer Behavior

Stable demand trends in H1FY26 with improving domestic demand in Q2FY26.

Geopolitical Risks

Export markets (55% of revenue) are subject to international trade regulations and economic conditions in overseas markets.

⚖️ Regulatory & Governance

Industry Regulations

Compliant with Section 148 of the Companies Act for maintaining cost accounting records, with Y. R. Doshi & Associates appointed as Cost Auditors for FY26.

Environmental Compliance

The company operates Zero Liquid Discharge (ZLD) plants, demonstrating high manufacturing controls and compliance with environmental standards.

Legal Contingencies

No reported frauds under Section 143(12). Statutory and Secretarial Audit reports for FY25 contained no qualifications or adverse remarks.

⚠️ Risk Analysis

Key Uncertainties

Raw material price volatility is the primary uncertainty, evidenced by the H1FY26 gross margin compression to 37.1%. Project execution risk exists for the INR 700-750 Cr SEZ plant and the USA expansion.