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In 2QFY25, most chemical companies under our coverage are likely to witness sales recovery YoY; Anupam Rasayan will be the only outlier. For SRF, fluoro specialty chemicals sales could see a sequential uptick (still weak YoY) given likely ramp-up of new active ingredients from 3QFY25. For PI, CSM sales are likely to see strong YoY growth owing to continued robust demand of Pyroxa along with some pick-up in new products. For Deepak, sequential uptick in phenolic spreads is likely to lift the performance of the phenolics business while the standalone business is likely to improve. Higher industrial salt volumes will bode well for Archean. Clean Science will benefit from volume pick-up of HALS along with its flagship products. PCBL will see robust volume growth along with higher spreads. Moreover, higher EBIT contribution from Aquapharm will also be positive. Aether will see ramp-up of volumes across segments. Ami will benefit from ramp-up of CDMO sales. Sharp jump in vegetable oil and derivatives prices will bode well for the spreads of Fine Organics and Galaxy Surfactants. On the agrochemicals front, marginal recovery has been seen in patches. However, a meaningful recovery in agrochem is still awaited.

* SRF’s EBITDA likely to shrink 3% YoY: SRF’s 2QFY25 EBITDA is likely to shrink 3% YoY on account of weakness in the chemicals business, which would be weak in this quarter owing to weakness in ref gas sales while specialty chemicals may see sequential recovery (albeit weak YoY). SRF’s chemicals sales are likely to be down 1% YoY. Further, owing to lower contribution from ref gas, we expect chemicals EBIT margin to come in at 20% (vs. 24.4% in 2QFY24).

* PI’s EBITDA likely to grow 18% YoY: For PI, CSM revenue is likely to be up 15% YoY (and up 4% QoQ) while the domestic business is likely to be flattish YoY. Besides, PI’s pharma business could see some sequential recovery. Moreover, there will be sales contribution from the recently acquired plant health care business. As a result, its 2QFY25 revenue is likely to increase 11%/13% YoY/QoQ. We have also assumed EBITDA margin at 27.7% (vs. 26%/28% in 1QFY25/2QFY24), accounting for one-off acquisition expenses. As a result, EBITDA is likely to jump 18%/11% YoY/QoQ.

* Fine Organics and Tatva Chintan’s EBITDA to grow 14% sequentially: We estimate Fine’s 2QFY25 sales to be up 12% sequentially, largely on account of sharp increase in product prices due to rise in raw material prices. Further, slight increase in EBITDA margin is likely to result in 14% QoQ growth in EBITDA. For Tatva, we estimate 3% sequential sales increase on account of 3% growth each across SDAs, PTC and PASC segments. Further, we expect sequential 118bps EBITDA margin jump. As a result, Tatva’s EBITDA is likely to jump 14% QoQ.

* Anupam Rasayan’s EBITDA to shrink 46% YoY; PCBL’s EBITDA to grow 3% QoQ: We estimate Anupam Rasayan’s 2QFY25 sales to shrink 32% YoY while EBITDA margin could fall 533bps on account of negative operating leverage. As a result, EBITDA is likely to decline 46% sequentially. For PCBL, we expect 3% QoQ EBITDA growth owing to i) slight volume growth, ii) increase in carbon black-CBFS spreads, and iii) higher Aquapharm contribution.

* Clean Science’s EBITDA to grow by 2% QoQ; Galaxy’s EBITDA to jump 5% QoQ: We estimate Clean’s 2QFY25 revenue to grow by 3% QoQ on account of volume growth. Further, on account of slightly lower EBITDA margin, EBITDA is likely to grow by 2% QoQ. For Galaxy Surfactants, we have assumed ~3% QoQ jump in sales and jump in EBITDA margin to INR 20,518 per tonne (vs. INR 19,368 per tonne in 1QFY25). This is likely to result in EBITDA jumping by 5% QoQ.

* Deepak’s EBITDA to grow by 7% QoQ; Archean’s EBITDA to grow by 30% QoQ: During 2QFY25, Deepak’s advanced intermediates (AI) sales could rise by 2% sequentially while AI EBIT margin could increase slightly to 10% (vs. 9.3% in 1QFY25). Further, benchmark phenol-acetone spreads during the quarter grew by >18% QoQ. This should result in 7% sequential rise in EBITDA for Deepak Nitrite. Archean’s 2QFY25 sales is likely to grow by 40% QoQ on account of higher salt and slight increase in bromine sales Further, while EBITDA margin is expected to be lower QoQ, its EBITDA is likely to grow by 30% QoQ.

* EBITDA to grow 3% QoQ for Aether, 34% QoQ for Ami: Aether’s 2QFY25 revenue could jump by 3%/13% QoQ/YoY with full recovery in production after supplies were impacted in 3Q-4QFY24 due to fire-led shutdown and steady demand. Moreover, margins are likely to be flat at ~24% (vs. 24% in 1QFY25). As a result, we expect Aether’s EBITDA to grow 3% QoQ. For Ami, we estimate 19% QoQ increase in sales mainly on account of jump in CDMO sales. Further, we expect sequential 220bps EBITDA margin jump. As a result, Ami’s EBITDA is likely to jump 34% QoQ

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