Nicely written as always. The business's potential is well recognized by the markets. The only reason why it hasn't shot up is because growth has been pretty stagnant even at such low base. Practically ~100 Crs for the last 3 years.
Their business's high barriers to entry itself is an impediment to the Co's growth. Even Kronos has to go through the same long qualification cycles, invest heavily in R&D and maintain strict audit and compliance standards. That can lead to delayed growth.
But definitely, a Co. to watch out for. Again nicely written. Rooting for more.
Peers like Vinati and NFIL have similar margins so it's not that only Kronox has boosted margins that are at the risk of going down. The entire industry operates on such margins because of the moats present. Because any new entrant cannot just open a new company and start competing is why margins are high and are likely to remain at similar levels. If it was a commodity business I would be worried about it but not in the specialty chemical business where each company enjoys some degree of moats
Nicely written as always. The business's potential is well recognized by the markets. The only reason why it hasn't shot up is because growth has been pretty stagnant even at such low base. Practically ~100 Crs for the last 3 years.
Their business's high barriers to entry itself is an impediment to the Co's growth. Even Kronos has to go through the same long qualification cycles, invest heavily in R&D and maintain strict audit and compliance standards. That can lead to delayed growth.
But definitely, a Co. to watch out for. Again nicely written. Rooting for more.
Fascinating. Niche markets intriging; innovation is key beyond barriers.
Thank you for your valuable information and excellent analysis 🙏👍🙏👍🙏👍👍
Fantastically written, as always ! Definitely a business to be kept in watchlist.
Hi great article. I just have one question, A company with such high OPM poses a risk of Operating deleverage. What are your views on it.
Peers like Vinati and NFIL have similar margins so it's not that only Kronox has boosted margins that are at the risk of going down. The entire industry operates on such margins because of the moats present. Because any new entrant cannot just open a new company and start competing is why margins are high and are likely to remain at similar levels. If it was a commodity business I would be worried about it but not in the specialty chemical business where each company enjoys some degree of moats