Prabhudas Lilladher has issued a buy rating on PCBL Chemical with a target price of ₹391 in its research report dated September 08, 2026. The brokerage values the stock at 25x FY28E EPS, citing the company's strong operating leverage to improving industry pricing and spreads. According to the report, a 10% upside to FY28 EBITDA/tn assumptions could potentially translate into an additional 23% upside to the target price.
PCBL Chemical delivered robust financial results for Q1 FY27, with consolidated net sales reaching ₹2,473.37 crore, up 17% year-on-year compared to the same period last year. The company's standalone net sales stood at ₹1,653.48 crore, registering a 13.8% Y-o-Y growth. This strong performance demonstrates the company's ability to capitalize on favorable market conditions and operational efficiency improvements.
The Indian carbon black market is experiencing a favourable shift in import dynamics that benefits domestic manufacturers. Imports of lower-priced Russian CB declined by ~60% during the first six months of CY26 compared with CY25, primarily due to disruptions at Russian refineries. Meanwhile, imports from China have increased, though at significantly higher prices of ~US$1.3/kg versus ~US$1/kg for Russian imports. Chinese suppliers, like Jiangsu, have announced additional price hikes, which could further increase the landed cost of imported CB into India.
Management has guided for a 14–15% YoY increase in FY27 EBITDA/tn over FY26, implying a full-year EBITDA/tn of ~₹17,000. According to the report, the current outlook could prove conservative if Russian CB supply continues to contract and global capacities remain offline, resulting in a tighter demand-supply balance and further strengthening pricing dynamics globally. PCBL's sensitivity to EBITDA/tn remains significant, with a ~₹1,500/tn increase over the FY28 EBITDA/tn assumption of ₹17,500 translating into nearly a 14% increase in FY28E EPS.
