Sustains improving revenue and profitability trajectory
Tatva Chintan Pharma Chem’s (TATVA) Q3FY26 print showed further signs of recovery, particularly in two key segments – SDA and PASC. Revenue in SDA grew 132% YoY driven by volumes while prices were stable. TATVA expects SDA revenue growth to sustain, with new customers’ offtake in CY26 and likely demand for Euro-7 norms. PASC is likely to benefit from the commencement of supplies of two large agro-intermediates, with modest volumes, which could scale up in next two years. Pharma intermediate is on course for commercialisation in H2FY27. Electrolyte salts’ orders for existing products have become frequent, with ramp-up in revenue likely in FY27. New agro-intermediate for domestic import substitution has been approved by customers, and may be an anchor for Jolva expansion. We cut FY26–27E EBITDA by 2–3% but raise TP to INR 1,955 (from INR 1,710) with an unchanged P/E multiple of 40x as we roll over valuation to FY28E. Retain BUY.
