Alkyl Amines Chemicals (AACL)’s 3QFY25 revenue increased 15% YoY to INR3.7b. The growth was mainly volume-driven, though the company continues to face pricing pressure from Chinese players. Gross margin expanded 80bp YoY to 48.4%, while EBITDAM stood at 19.2%. RM prices declined more than FG prices. PAT came in at INR438m vs. our estimate of INR298m. Management highlighted that the Ethylamine plant contributed to volumes in 3Q, without which it would have faced constraints on that front. Although its utilization is at 60-65%, the company expects this to pick up going forward. At some point in the future, there could be a debottlenecking process in the plant, increasing the capacity from 100tpd currently to 120tpd.
OutlookThe stock is trading at ~34x FY26E EPS and ~22x FY26E EV/EBITDA. We reiterate our Neutral rating on AACL with a TP of INR1,900, based on 30x Dec’26E EPS.
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