STALLION INDIA FLUOROCHEMICALS LTD
Pioneering India’s Transition to Next-Gen Refrigerants
Stallion is entering a decisive growth inflection point as India shifts toward environmentally sustainable refrigerants. The company is transitioning from a gas trading and blending model to a fully backward-integrated manufacturer, led by its upcoming greenfield R-32 refrigerant facility. This shift is expected to structurally upgrade margins, earnings visibility and valuation over the next 2–3 years.
Market Snapshot
CMP: ₹258 | Market Cap: ₹2,000 Cr
52-Week Range: ₹60 – ₹424
Valuation: P/E 45x | P/B 6.4x
ROE: 15% | ROCE: 19%
The stock is trading nearly 40% below peak levels, creating a favorable risk-reward setup ahead of its manufacturing transition.
Investment Thesis
Stallion is executing a transformational pivot into the fast-growing R-32 refrigerant segment, backed by regulatory tailwinds, accelerating financial performance, a near debt-free balance sheet and strong promoter commitment.
Product Portfolio
A diversified portfolio of 40 plus specialty and refrigerant gases, including high-volume and next-generation variants such as R-32, R-134a, R-410A, R-404A, R-407C and multiple eco-friendly blends, catering to HVAC, automotive, pharmaceuticals and electronics applications.
Key Strengths
Strong promoter alignment: 67.9% ownership ensures long-term strategic focus
Pristine balance sheet: Virtually debt-free with Net D/E of 0.01x
Deep technical know-how: Proven custom blending capabilities and a pan-India distribution network providing strong customer stickiness and scalability
FINANCIAL PERFORMANCE
Q2 FY26 Highlights
Revenue grew 56% YoY to ₹106 Cr, with operating margins at 15%. Net profit stood at ₹11 Cr, reflecting continued earnings momentum.
Annual Financial Trend
The company’s revenue has grown steadily from ₹118 Cr in FY21 to ₹453 Cr on a TTM basis, with a sharp acceleration in FY25. Net profit has also improved significantly, rising from ₹10 Cr in FY21 to ₹45 Cr TTM after a brief dip in FY23. Operating margins have strengthened from 10% to 14% TTM, while EPS has improved to ₹6.01 TTM, reflecting better profitability and growth momentum.
3-Year CAGR: Sales 27% | Profit 15%
TTM Growth: Revenue +62% | Profit +109%
Financial Observations:
The company enjoys strong growth momentum, improving profitability and a debt-free structure. However, working-capital intensity and negative operating cash flows require monitoring, with debtor days around 102.
STRATEGIC CATALYSTS
R-32 Manufacturing Plant – Bhilwara
This ₹200 Cr greenfield project is the company’s most important growth catalyst. The facility will have a capacity of 10,000 MT per annum, targeted for commercial operations by July 2026. The plant can potentially generate ₹500 Cr of annual revenue with 22–24% PAT margins, transforming Stallion into a fully backward-integrated refrigerant manufacturer.
Funding: Promoters sold 3.06% stake (~₹65+ Cr) and infused proceeds as interest-free loans. The company has shareholder approval to raise ₹500 Cr for future expansions.
Expansion Projects
Khalapur (MH): Expected by Q4 FY26
Mambattu (AP): Southern market penetration
IPO & Market Performance
Listed in January 2025 at ₹120, the stock peaked at ₹424 in October 2025. The current correction phase offers an attractive long-term accumulation opportunity.
VALUATION & TARGETS
The stock trades at ~45x earnings and ~30x EV/EBITDA, reflecting a premium valuation that is considered justified given the transformational manufacturing pivot and strong growth visibility.
Target Estimates:
Base Case FY27E: Revenue ₹800 Cr, EPS ₹9.5
Bull Case FY28E: Revenue ₹1,100 Cr, EPS ₹15
TECHNICAL VIEW
The chart structure signals a bullish reversal, supported by a positive GMMA crossover, rising volumes and a developing inverted head-and-shoulders pattern. A strong support base is visible at ₹220–225, while a decisive breakout above ₹265–270 could open up meaningful upside potential over the medium to long term.
RISKS
Key risks include delays in R-32 commissioning, working-capital pressure, competition from larger fluorochemical players, potential equity dilution, and valuation sensitivity.
FINAL VERDICT
Stallion is undergoing a strategic transformation into a high-margin, fully integrated refrigerant manufacturer at a time when industry tailwinds are turning decisively favorable. The commissioning of its R-32 greenfield facility is expected to materially improve earnings visibility, margin profile and long-term valuation, positioning the company for a sustained growth re-rating cycle. The stock can be considered with a 24–36 month investment horizon, with an accumulation zone of ₹220–245. Expected returns are estimated at 30–45% over 12 months, 60–85% over 24 months, and 100%+ over 36 months, subject to market conditions and execution progress.
Disclaimer
This analysis is intended solely for informational purposes and does not constitute any investment or financial advice. All information is sourced from public company filings, analyst reports, and third-party sources believed to be reliable. In accordance with SEBI guidelines, market data is presented accordingly. Investors should conduct independent research, perform due diligence, and consult qualified financial advisors before making any investment decisions. The views expressed are personal and may be subject to errors or bias.
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The margin expansion math here is compelling but that 102-day debtor cycle is hiding in plain sight. When you're scaling a backward integration play with 10K MT capacity, working capital can become a serious drag on cash generation even if the EBITDA story looks clean. Had a similar experience watching another specialty chemicals player where the plant came online smooth but receivables ballooned because OEM customers demanded extended payment terms on bulk orders. The R32 thesis itself is solid given Kigali Amendment timelines, curious if they've locked in any long-term offtake agreements to derisk that ₹500cr revenue projection?