Company overview - Established in 2004, Paragon specializes in custom specialty chemicals with a strong global clientele and operations across multiple sectors, such as pharmaceuticals, agrochemicals, and electronics. Paragon is a leading global supplier of specialty intermediates.
Industries Served : Specialty Pigments & Dye; Agrochemical; Cosmetic; Pharmaceuticals; Electronics
Key strengths include its diverse portfolio of over 140 products, advanced in-house capabilities for complex chemical reactions, and robust client relationships built over lengthy R&D and development cycles. Paragon has benefitted from increasing demand in both domestic and export markets, maintaining a 50/50 revenue split. Their planned expansion aims to double production capacity, supporting both existing products and new innovations to drive revenue growth.
Clients - 100+ Global Clients including marquee names such as Everlight Chemical Industrial Corporation; Archroma; Modern Dyestuff & Pigments Co. Ltd.; Pidilite Industries. Has built long-term relationships with each client by providing speciality intermediates. Has been consistently growing customer and product base. Leveraging Custom Synthesis and Tech NDA agreements, we tailor solutions across a diverse range of over 40 chemistries to meet the unique requirements of each customer
Growth - Company’s growth is on an upward trajectory, with current capacity at 650 MTPA and plans for expansion to 850 MTPA by June 2025
Introduction of HALQUINOL, targeting an addressable market of 10,000 MTPA, with a projected production of at least 150 MTPA, highlights strategic market penetration.
Anticipated GMP certification for HALQUINOL Pharma grade is expected to significantly enhance revenue by ~ ₹15 Cr, with robust profit margins ranging between ~ 30% to 40%.
EBITDA is expected to maintain stability, driven by an anticipated revenue growth of ~ 20% year-over-year (YoY) till FY26
High ROE and ROCE
Excelling in 20+ chemistries - anchored on innovation and new product development. Company operates primarily in value added chemicals
Management - Technocratic management with next-gen also getting involved in the business. + In-house R&D facility with 14 technocrats.
Profile - Dr Rutesh V. Savalia, our Director at Paragon Fine & Specialty Chemical Limited, With Ph.D. in Organic Chemistry from the prestigious Institute of Chemical Technology, Mumbai (formerly UDCT),is a dynamic leader with a unique blend of academic excellence and practical expertise. Rutesh holds a Master of Science in Chemistry from the renowned Indian Institute of Technology (IIT-ISM Dhanbad). With a rich background in research and development spanning four years, Rutesh leads our marketing initiatives, new product development, and new business ventures. His dedication to innovation and progress has propelled our company forward. Notably, Rutesh is a recipient of the esteemed Prime Minister’s Fellowship for Research, a testament to his outstanding contributions to the field.
Shivam Patolia, our Director at Paragon Fine & Specialty Chemical Limited, is a dynamic leader with a global perspective and a unique blend of educational excellence. Holding a Bachelor’s degree in Mechanical Engineering from the University of Pittsburgh (USA) and a Master’s in Investment & Wealth Management from Imperial College London (UK), Shivam brings a wealth of knowledge and experience to our team.
The company’s strategy includes focusing on high-margin, low-volume specialty products and sustaining relationships that serve as entry barriers for competitors. Key differentiators include Paragon’s deep expertise in multiple chemistries, tailored client contracts, and high standards in quality control and audit compliance. Looking forward, Paragon aims to further increase market share by introducing new products in the cosmetic and electronics sectors and expanding R&D-driven innovation.
Robust Product Pipeline
Trading at fair valuations with PE <19, EV/EBITDA < 13, P/B - 3. Company is aiming for 1000rs revenue and aims to grow in high teens over the next few years.
Risks
- Volatile market conditions can affect margins. However management is indicating that they are primarily involved in speciality N+3 so margins won’t get affected too much
- Reliance on client relationships - Company is relying on client relationships and primarily developing specialized products on demand
Disc: Invested
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