Clean Science & Technology Limited (CSTL) has announced a significant capital infusion of ₹70 crore into its wholly owned subsidiary, Clean Fino-Chem Limited (CFCL). This strategic move, disclosed in a regulatory filing, marks a substantial investment in the speciality chemicals sector.

Investment Details

The investment was executed through a rights issue, where CSTL subscribed to an additional 11,70,569 equity shares of Clean Fino-Chem. The shares, with a face value of ₹10 each, were acquired at a premium of ₹588 per share, totaling ₹70,00,00,262.

Purpose and Impact

According to the company's statement, the primary objective of this capital injection is to fund CFCL's ongoing projects. This move is expected to strengthen the subsidiary's position in the speciality chemicals industry and support its growth initiatives.

About Clean Fino-Chem Limited

Clean Fino-Chem, incorporated on March 22, 2022, operates in the speciality chemicals sector. The company has shown rapid growth since its inception:

Transaction Details

• The transaction falls under the related party category, as CFCL is a wholly owned subsidiary of CSTL.
• The investment was made at arm's length, ensuring fairness and transparency in the transaction.
• Post-investment, CSTL maintains 100% ownership of CFCL.

This strategic investment by Clean Science & Technology Limited underscores the company's commitment to expanding its presence in the speciality chemicals market through its subsidiary. The significant increase in CFCL's turnover over the past two years suggests a positive trajectory, which this fresh capital infusion aims to further accelerate.

Clean Science & Technology , a leading manufacturer of specialty chemicals, has reported its Q1 results and revised its growth projections, leading to a significant impact on its stock price.

Q1 Financial Performance

The company's Q1 financial results show mixed performance:

Revised Growth Projections

Clean Science & Technology has adjusted its full-year EBITDA growth expectations from the previously anticipated 18-20% to a more conservative range of 15-18%. This revision reflects both challenges and opportunities in its business landscape.

Stock Performance

Following the Q1 results announcement and management's commentary on a potential stake sale, the company's shares fell by 7.00%.

Potential Stake Sale

The company's promoters are evaluating a minority stake sale for family estate planning purposes. This news has contributed to the stock's volatility.

Product Portfolio and Expansion

Clean Science & Technology continues to diversify its product mix, with over 25% of revenue now coming from newer launches. The company has successfully commercialized its entire HALS (Hindered Amine Light Stabilizers) capacity planned under phase 1, with sales volumes accelerating across multiple HALS grades.

Future Outlook

Despite the revised near-term growth projections, Clean Science & Technology remains committed to its long-term expansion plans. The company is focusing on developing a wider range of products, including an expanded HALS series, DHDT, BHT, and new offerings in the performance chemical segment.

Quarterly Expectations

Management expects the second quarter (Q2) growth to mirror the slower pace observed in Q1. However, they anticipate an uptick in performance during Q3, with Q4 projected to show particularly strong growth.

Investors and analysts will be keenly awaiting more details after the Q2 results to gain further insights into the company's performance and strategic direction in light of these adjusted projections and potential stake sale.

Clean Science & Technology continues to navigate the challenges of the specialty chemicals market while leveraging its R&D capabilities and diversified product portfolio to drive sustainable growth.