@ishu For commodity companies, its tough to analyse the business on a longer term time frame. Because no one including the management have any idea about how things are going to pan out over next few quarters, let alone next few years. I know a few chemical sector experts who are in regular contact with chemicals business persons who have the prices of a lot of commodity products like phenol, benzene, their derivatives, etc at their fingertips. These are the kind of guys who can play the chemicals game successfully. One can cultivate contacts in this space to derive an edge.
The other option is to buy with a wide margin of safety at close to or below replacement cost and hope that the cycle turns. Yet another way is to join the party once it has begun, and hope for a quick ride.
Different ways to play the game, but I guess DCF would feature among the least preferable option.
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