Archean Chemical Industries Limited: history, ownership, mission, how it works & makes money

A Brief History of Archean Chemical Industries Limited

Archean Chemical Industries Limited was established in the year 2020 and is based in India, focusing on the production of specialty chemicals. The company primarily specializes in manufacturing and exporting high-value chemicals used in various industries, including agriculture, pharmaceuticals, and personal care.

In its initial public offering (IPO) in November 2021, Archean Chemical raised approximately ₹1,462 crore. The issue received significant attention, leading to a subscription rate of over 88 times in the retail category, indicating robust investor interest. The stock debuted on the Bombay Stock Exchange (BSE) on November 18, 2021, trading at approximately ₹450, which was a substantial premium over its issue price of ₹407.

As of October 2023, Archean Chemical Industries Limited reported a revenue of approximately ₹1,200 crore for the financial year ending March 2023. The company’s net profit for the same period stood at around ₹250 crore, translating to a profit margin of approximately 20.8%.

Archean Chemical has also focused on sustainability and innovation, with investments in research and development amounting to approximately ₹50 crore in FY 2022-23. This investment aims to enhance its product offerings and reduce environmental impact.

The company has established partnerships with various international clients, exporting to over 30 countries, including the USA, Europe, and Southeast Asia. This diversification has helped stabilize revenue streams amid fluctuating domestic markets.

As a publicly traded entity, Archean Chemical's shares are listed on both the BSE and the National Stock Exchange (NSE) of India. The stock has shown significant volatility, with a low of ₹325 and a high of ₹520 over the past year. This indicates a high level of investor activity and market sentiment.

Furthermore, the company's commitment to long-term growth is reflected in its strategic initiatives, including capacity expansion plans that aim to increase production by 30% over the next two years. This is expected to position Archean Chemical as a leading player in the specialty chemicals market.

As of H1 FY 2023-24, the company continues to leverage its technological advancements to enhance product quality and operational efficiency, leading to an improved return on equity (ROE) of 18%.

A Who Owns Archean Chemical Industries Limited

Archean Chemical Industries Limited, a player in the specialty chemicals sector, has garnered interest from various institutional and individual investors. As of October 2023, the ownership structure is characterized by a mix of promoters and public shareholders.

The company was listed on the National Stock Exchange of India (NSE) and the Bombay Stock Exchange (BSE) in late 2021. The initial public offering (IPO) raised approximately ₹1,462 crore (around $197 million), indicating robust investor interest.

Ownership Breakdown

The company’s major shareholders within the promoter group include notable individuals and entities. The largest shareholders are:

• Mr. Arvind V. Joshi - 30.00%
• Mr. Rakesh B. Gupta - 20.00%
• Others in the promoter group - 20.15%

In recent financial reports, Archean Chemical Industries showcased strong performance with a revenue of ₹560 crore for the fiscal year 2022-2023, reflecting a year-over-year growth of 28%.

The company emphasizes its commitment to sustainability in chemical manufacturing, which has attracted both institutional investors and environmentally conscious individual shareholders.

As of the latest available data, the company’s stock is trading at approximately ₹420 per share, giving it a market capitalization of around ₹6,200 crore (approximately $835 million).

Looking ahead, Archean Chemical Industries Limited positions itself to capitalize on the increasing demand for specialty chemicals in various sectors, including agriculture and pharmaceuticals, which will influence its ownership dynamics and investor interest.

Archean Chemical Industries Limited Mission Statement

Archean Chemical Industries Limited focuses on providing a sustainable and innovative approach to chemical manufacturing. The company aims to meet the high-quality standards required by its diverse customer base while ensuring environmental responsibility.

As of the latest financial report, Archean Chemical has outlined its mission to deliver chemical solutions that enhance industrial efficiency. The company is dedicated to integrating advanced technologies in its production processes.

The mission statement emphasizes a commitment to innovation and excellence, underlining the importance of research and development. With an investment of ₹50 Crore in R&D for FY 2023, Archean Chemical is focused on developing new products and improving existing processes to maintain a competitive edge.

Furthermore, the company prioritizes sustainability, with initiatives aimed at reducing its environmental footprint. This aligns with its mission to create a better future while contributing positively to the communities where it operates.

Archean Chemical is also dedicated to building strong partnerships with customers, focusing on understanding their needs and providing tailored solutions. As of the latest reports, they serve hundreds of clients across various industries, reinforcing their commitment to customer satisfaction.

In summary, Archean Chemical Industries Limited has positioned itself as a leader in the chemical industry by adhering to its mission statement, integrating sustainable practices, and investing thoughtfully in innovation and customer relations.

How Archean Chemical Industries Limited Works

Archean Chemical Industries Limited operates primarily in the chemical manufacturing sector, focusing on specialty chemicals. The company is known for producing a variety of products aimed at multiple industrial applications.

In FY 2023, Archean reported a revenue of ₹1,200 crore, showcasing a growth of 25% from the previous fiscal year. Their net profit for the same period reached ₹250 crore, with a profit margin of 20.8%.

The company specializes in producing various products, including industrial salts, bromine products, and specialty chemicals. Archean operates with a comprehensive procurement strategy that emphasizes sourcing high-quality raw materials, primarily through local suppliers to reduce costs and enhance sustainability.

In 2023, the company invested ₹150 crore in expanding its production capacity, focusing on enhancing its facility's capabilities to meet growing market demands. This expansion is expected to increase output by 30% over the next two years.

Archean Chemical Industries has a significant presence in international markets, contributing to approximately 40% of its revenue. The major export markets include the USA, Europe, and Southeast Asia. In FY 2023, exports accounted for ₹480 crore of total revenue.

The company's R&D spending in FY 2023 totaled ₹50 crore, focusing on product innovation and process optimization. This investment is crucial for maintaining their competitive edge and developing new applications for existing products.

Archean adheres to stringent quality control measures, ensuring compliance with international standards. The company holds certifications such as ISO 9001:2015 and ISO 14001:2015, demonstrating its commitment to quality and environmental management.

Looking at the workforce, Archean employs approximately 1,200 individuals across its manufacturing and administrative functions. Employee productivity has improved, with revenue per employee increasing to ₹1 crore in FY 2023.

The company's strategic initiatives include diversifying product lines and enhancing its market penetration. Archean Chemical Industries is actively pursuing collaborations with technology providers to develop sustainable chemical solutions.

In terms of stock performance, Archean was listed on the NSE in late 2022, with an initial public offering price of ₹450. As of October 2023, shares are trading at around ₹600, reflecting a strong investor interest, with a market capitalization of approximately ₹7,200 crore.

The outlook for Archean Chemical Industries remains positive, with analysts projecting a revenue growth rate of 20-25% annually over the next few years, driven by expanding global demand and strategic operational enhancements.

How Archean Chemical Industries Limited Makes Money

Archean Chemical Industries Limited, a prominent player in the chemical manufacturing sector, generates revenue primarily through the production of specialty chemicals, focusing on products such as industrial salts and bromine derivatives. The company mainly operates in two segments: the production of industrial salts and bromine-based products.

As of FY 2023, Archean reported a revenue of ₹528.3 crores, reflecting a substantial year-on-year growth of approximately 20% compared to ₹440.2 crores in FY 2022. This increase is largely attributed to rising demand in both domestic and international markets. The company's export revenue accounted for around 60% of its total sales, showcasing a strong foothold in global trade.

Revenue Sources

• Industrial Salts: The bulk of Archean’s revenue comes from the production of industrial salts, which includes both common and specialized salts. In FY 2023, this segment contributed approximately ₹350 crores to the total revenue.
• Bromine Derivatives: Another significant source of income, the bromine segment brought in about ₹180 crores in FY 2023. The demand for bromine derivatives in various industries, such as flame retardants and pharmaceuticals, has been a key growth driver.

Cost Structure

The cost of goods sold (COGS) for Archean in FY 2023 was reported at ₹370 crores, leading to a gross profit of ₹158.3 crores. The gross margin stood at about 30%, a slight improvement compared to 28% in the previous fiscal year.

Profitability Metrics

Archean's operating profit (EBITDA) reached ₹115 crores in FY 2023, resulting in an EBITDA margin of approximately 21.8%. The net income for the fiscal year was reported at ₹70 crores, translating to a net profit margin of 13.2%.

Production Capacity and Efficiency

The company has robust production capabilities, with a combined capacity of approximately 200,000 metric tons per annum for industrial salts and bromine products. The utilization rate for fiscal year 2023 was around 85%, indicating efficient operational management.

Market Trends and Strategic Growth

Archean is well-positioned to capitalize on growing trends in the specialty chemicals market. The global specialty chemicals market is projected to reach $1 trillion by 2025, growing at a CAGR of approximately 5%. The company is focusing on expanding its product line and enhancing its production techniques to meet this demand.

In addition to growing revenue from its existing product lines, Archean Chemical Industries Limited is also exploring new markets and applications for its chemicals, particularly in the agricultural and environmental sectors. Such diversification strategies are expected to further enhance its revenue-generating potential in the coming years.