Gandhar Oil Refinery : nearly 40% of revenue being derived from international sales

Gandhar Oil Refinery : nearly 40% of revenue being derived from international sales

  • Extensive industry and promoter experience with diversified client portfolio 
    • The group has nearly three decades of experience in the specialty oil industry and is known for its presence in the industry at both domestic and international forums. 
    • The company was started by Mr Ramesh Parekh, Chairman, who is now supported by his sons Mr. Samir Parekh, and Mr. Aslesh Parekh. 
    • The group also caters to a reputed clientele base in more than 100 countries, including the UAE, Brazil, the USA, Europe, and Asia with nearly 40% of revenue being derived from international sales. 
    • Further, revenue is diversified across Personal care, Healthcare and Performance oil (PHPO) segment having ~ 52% of FY24 revenue, Lubricants ~ 31%, Process Insulating Oil (PIO) ~ 7% and channel partners ~ 10%. 
    • Some of its clients include Unilever, Proctor & Gamble, Marico, Dabur, Emami, Indian Railways, State Electricity Boards, and Discoms. 
    • The company also has established relationships with its suppliers wherein it has entered into supply contracts with large international as well as domestic oil refineries such as Saudi Aramco, S-Oil Corporation, BPCL, and HPCL, respectively. 
    • AcuitΓ© believes that group will continue to benefit from its experienced management, established relations with clients and suppliers, and long track record of operations. 
Stable revenue growth despite global challenges affecting margins 

  • The consolidated scale of operations stood improved at Rs. 4,113.21 Cr. in FY24 against Rs. 4,079.03 crore in FY23. 
  • This is attributable to the sustained demand from international markets specifically from Asia Pacific and America leading to improved overseas sales. 
  • However, the increasing freight rates and delays in import shipment of raw materials leading to increase in input cost due to the Red Sea issue affected the operating margin to reduce to 6.81 percent in FY24 against 7.77 percent in FY23. 
  • Further, the ongoing Red Sea issue coupled with softness in global FMCG & Pharma demand leading to reduction in per unit realisation has affected the 9MFY25 operating performance of group resulting into reduced revenue of Rs.2,935.20 Cr. at margin of 4.84% in 9MFY25 as against Rs.3,173.97 Cr. at 7.72% margin in 9MFY24. 
  • However, the company has continued its focus to expand the operations, client base and stabilise its margins, which shall be a key rating sensitivity. 
  • The company completed its capex expansions of 1,00,000 KL at Taloja in FY24 at a cost of ~Rs.60-70 Cr. 
  • Further, expansion of capacity at Silvassa plant by 80,000 KL at a cost of ~Rs 27 Cr. (~Rs.17 Cr completed till 9MFY25) and is expected to be completed in FY25.



Gandhar Oil Refinery : Listed IPO at less than 15 PE 

https://youtu.be/08-eOqlx5M8?si=jDwnFv8O1RxL_Nvv

  • Pursuant to Regulation 30 of Securities and Exchange Board of India (“SEBI”) (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) read with Part A of Schedule Ill and Circular no. SEBI/HO/CFD/CFDPoD1/P/CIR/2023/123 dated July 13, 2023, this is to inform that Gandhar Oil Refinery (India) Limited (“the Company”) has received a Rate Contract/Framework Agreement from Bharat Heavy Electricals Limited (BHEL), Jhansi for a period of Two Years for supply of Transformer Oil. 
  • Personal care, Healthcare and Performance Oils ( 54.96% revenue) : Petroleum jelly, Waxes and White oil ( is the Largest Business Division with Exposure to Fast-growing Consumer and Healthcare End-Industries)
  • 26.5% market share in India in white oil in FY23
  • Lubricant 25.03%
  • EBITDA Margin (%): 7.72%
  • PAT Margin (%): 4.83%

 Thank you for contacting Rounaq! Please let us know how we can help you. 

Whatsapp: 7838491131

SEBI registered RA : Rounaq Bakshi
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