Smallcap stock to buy: Up 480% in 5 years, this multibagger receives 30% upside target
Multibagger stock: The largest aroma chemical manufacturer and exporter is scaling its core operations through capacity additions, product diversification and deeper customer engagement
- Nov 28, 2025,
- Updated Nov 28, 2025 9:41 AM IST
Motilal Oswal Financial Services Ltd initiated coverage on smallcap multibagger Privi Speciality Chemicals with a 'Buy' rating and a target price of Rs 3,960, implying nearly 30 per cent upside. The brokerage said the largest aroma chemical manufacturer and exporter is scaling its core operations through capacity additions, product diversification and deeper customer engagement, while strategically entering the green chemistry domain to strengthen its long-term growth trajectory. This shift is aimed at tapping environmentally sustainable demand pockets and broadening its client reach across end-use industries, it said.
The stock is up 478.82 per cent in the past five years.
MOFSL said aroma chemicals market has continued to expand, supported by strong demand for home fragrances, steady growth in cosmetics, personal care, bakery and confectionery segments, rising consumer focus on safety and ingredient transparency, and increasing disposable incomes across emerging markets. Given the wide applications of green chemistry products, Privi is expected to address a larger wallet share from existing customers, with the total addressable market for its new portfolio estimated at about $386 million. The proposed merger with Privi Fine Sciences is expected to enhance these prospects further, MOFSL said.
It noted that the company is planning to increase its core-product capacity from 48,000 tons to 66,000 tons by March 2028. It also intended to add 18,000 tons of new-product capacity in FY27 and double this expanded capacity to 36,000 tons by FY29, supporting its growth and diversification strategy in sustainable chemistry. The joint venture with Givaudan remained another pivotal milestone, deepening technological capabilities and reinforcing long-standing customer relationships. With a dedicated greenfield facility and shared investments, the partnership positioned Privi in the higher-value, complex fragrance ingredient segment globally, MOFSL said.
Over the past three years, the stock rerated from about 31.6 times one-year forward P/E to about 35.5 times as of November 2025, aided by robust cash flow generation, consistent earnings performance (24 per cent PAT CAGR over FY22–25) and improved return ratios (RoE of 18 per cent in FY25). Revenue, Ebitda and adjusted PAT grew at a CAGR of 14 per cent, 32 per cent and 24 per cent, respectively, over FY22–25.
MOFSL expects them to accelerate to 27 per cent, 34 per cent and 46 per cent, respectively, over FY25–28. Privi shares traded at 39 times FY26, 32 times FY27 and 22 times estimated FY28 EPS, with RoE and RoCE expected at 25 per cent and 18 per cent in FY28E.
Motilal Oswal valued the stock at 28 times its FY28 EPS estimate of Rs 141.
MOFSL said aroma chemicals market is projected to grow from $5.4 billion in 2023 to $9.2 billion by 2030, an 8 per cent CAGR, supported by home care, personal care and food categories. To leverage this, Privi has continued its expansion programme from 48,000 MT to 66,000 MT by March 2028, while building out higher-margin, value-added products, MOFSL said.
MOFSL said the company's leadership in pine-based aroma chemicals is anchored in deep backward integration into crude sulphate turpentine (CST), a cost-efficient raw material sourced from more than 60 pulp mills globally.
CST offered a 15–20 per cent cost advantage over gum turpentine oil and provided better price stability through fixed contracts. Privi remained one of only four global players — and the only Asian one — capable of processing CST efficiently, supported by its dedicated refinery commissioned in 2016, the world’s largest at a single site.
With backward integration and increased in-house production of alpha and beta pinene, margins expanded from 11–12 per cent a few years earlier to above 18 per cent recently, reaching 25 per cent in the first half of FY26.
MOFSL said the company also resolved CST-related challenges, such as sulphur-induced odour, through its proprietary separation process, strengthening its leadership in products like dihydromyrcenol, amber fleur and terpineol-pine oil. Its flexibility to switch between CST and GTO allowed it to maintain the lowest cost structure globally and offer stable pricing to B2B clients — a key competitive advantage that reinforced its market position.
Motilal Oswal Financial Services Ltd initiated coverage on smallcap multibagger Privi Speciality Chemicals with a 'Buy' rating and a target price of Rs 3,960, implying nearly 30 per cent upside. The brokerage said the largest aroma chemical manufacturer and exporter is scaling its core operations through capacity additions, product diversification and deeper customer engagement, while strategically entering the green chemistry domain to strengthen its long-term growth trajectory. This shift is aimed at tapping environmentally sustainable demand pockets and broadening its client reach across end-use industries, it said.
The stock is up 478.82 per cent in the past five years.
MOFSL said aroma chemicals market has continued to expand, supported by strong demand for home fragrances, steady growth in cosmetics, personal care, bakery and confectionery segments, rising consumer focus on safety and ingredient transparency, and increasing disposable incomes across emerging markets. Given the wide applications of green chemistry products, Privi is expected to address a larger wallet share from existing customers, with the total addressable market for its new portfolio estimated at about $386 million. The proposed merger with Privi Fine Sciences is expected to enhance these prospects further, MOFSL said.
It noted that the company is planning to increase its core-product capacity from 48,000 tons to 66,000 tons by March 2028. It also intended to add 18,000 tons of new-product capacity in FY27 and double this expanded capacity to 36,000 tons by FY29, supporting its growth and diversification strategy in sustainable chemistry. The joint venture with Givaudan remained another pivotal milestone, deepening technological capabilities and reinforcing long-standing customer relationships. With a dedicated greenfield facility and shared investments, the partnership positioned Privi in the higher-value, complex fragrance ingredient segment globally, MOFSL said.
Over the past three years, the stock rerated from about 31.6 times one-year forward P/E to about 35.5 times as of November 2025, aided by robust cash flow generation, consistent earnings performance (24 per cent PAT CAGR over FY22–25) and improved return ratios (RoE of 18 per cent in FY25). Revenue, Ebitda and adjusted PAT grew at a CAGR of 14 per cent, 32 per cent and 24 per cent, respectively, over FY22–25.
MOFSL expects them to accelerate to 27 per cent, 34 per cent and 46 per cent, respectively, over FY25–28. Privi shares traded at 39 times FY26, 32 times FY27 and 22 times estimated FY28 EPS, with RoE and RoCE expected at 25 per cent and 18 per cent in FY28E.
Motilal Oswal valued the stock at 28 times its FY28 EPS estimate of Rs 141.
MOFSL said aroma chemicals market is projected to grow from $5.4 billion in 2023 to $9.2 billion by 2030, an 8 per cent CAGR, supported by home care, personal care and food categories. To leverage this, Privi has continued its expansion programme from 48,000 MT to 66,000 MT by March 2028, while building out higher-margin, value-added products, MOFSL said.
MOFSL said the company's leadership in pine-based aroma chemicals is anchored in deep backward integration into crude sulphate turpentine (CST), a cost-efficient raw material sourced from more than 60 pulp mills globally.
CST offered a 15–20 per cent cost advantage over gum turpentine oil and provided better price stability through fixed contracts. Privi remained one of only four global players — and the only Asian one — capable of processing CST efficiently, supported by its dedicated refinery commissioned in 2016, the world’s largest at a single site.
With backward integration and increased in-house production of alpha and beta pinene, margins expanded from 11–12 per cent a few years earlier to above 18 per cent recently, reaching 25 per cent in the first half of FY26.
MOFSL said the company also resolved CST-related challenges, such as sulphur-induced odour, through its proprietary separation process, strengthening its leadership in products like dihydromyrcenol, amber fleur and terpineol-pine oil. Its flexibility to switch between CST and GTO allowed it to maintain the lowest cost structure globally and offer stable pricing to B2B clients — a key competitive advantage that reinforced its market position.