Polychem Adjusts Quality Grade Amid Strong Sales and EBIT Growth

Polychem, a microcap player in the commodity chemicals sector, has recently undergone a quality adjustment reflecting its current financial standing. The company has demonstrated a notable sales growth of 11.15% over the past five years, alongside a robust EBIT growth of 37.70%. Its EBIT to interest ratio stands at 3.81, indicating a solid ability to cover interest expenses.
Polychem's financial leverage appears favorable, with a debt to EBITDA ratio of 0.21 and a net debt to equity ratio of 0.00, suggesting minimal reliance on debt financing. The company's sales to capital employed ratio is recorded at 1.20, while its tax ratio is at 10.94%. Additionally, the dividend payout ratio is 16.83%, reflecting a commitment to returning value to shareholders.

In comparison to its peers, Polychem's performance metrics reveal a mixed landscape. While it holds a below-average quality score, competitors such as Stallion India and TGV Sraac maintain average standings. Polychem's return metrics show a decline over various periods, particularly year-to-date, where it lags behind the Sensex. However, its long-term performance over five and ten years remains significantly positive compared to the broader market.