Chemical stock jumps 8% after Nippon India MF and Theleme India increase their stake

Synopsis: Shares of Sudarshan Chemical Industries remain in focus after the stock surged 7.74% following a key block deal in which Nippon India Mutual Fund and Theleme India Master Fund increased their stake

India’s specialty chemical sector has often seen sharp market reactions whenever institutional investors accumulate stakes in niche businesses with improving earnings visibility. That appears to be the case with Sudarshan Chemical Industries Limited, where fresh buying interest has brought the stock back into focus.

The shares of one of India’s leading pigment manufacturers gained nearly 7–8% in the previous session after Nippon India Mutual Fund and Theleme India Master Fund together bought an additional 2.26% stake through block deals.

With a market capitalisation of ₹6,868 crores, the shares of Sundaram Chemical Industries are trading at ₹874 a piece in today’s market session. The stock has delivered ~8% returns this month.

Who Sold the Stake?

According to exchange disclosures, the sellers in the transaction were members of the promoter/shareholder group that included Rahul Pradeep Rathi who sold 7.86 lakh shares at ₹810.73 per share (valued at ~₹63.73 crore), Pradeep Ramwilas Rathi who sold 7.86 lakh shares at ₹810.05 per share (around ₹63.67 crore), and Anuj Narayandas Rathi who also sold 7.86 lakh shares at ₹810.00 per share (~₹63.67 crore).

On the buying side, Nippon India Mutual Fund acquired 13.82 lakh shares at an average price of around ₹810, amounting to roughly ₹111 crore, while Theleme India Master Fund Limited purchased 4 lakh shares at a similar price, valued at about ₹32 crore.

Such block deals are often ownership transfers between existing shareholders and incoming institutions. Rather than being viewed only as buying or selling pressure, markets usually interpret them through the lens of who is entering, who is reducing stake, and whether long-term institutional interest is increasing.

Why Did Investors Buy Now? And the list of plausible reasons includes

• Specialty Chemical Cycle Stabilising: After a weak phase marked by softer exports, inventory corrections, and margin pressure across chemical companies, markets are watching for signs of recovery. If the worst of the downcycle is over, quality names often get bought early.
• Raw Material Costs Could Improve Margins: Pigment manufacturers depend on crude-linked and chemical feedstock inputs. If input costs stabilise while selling prices remain healthy, profitability can improve sharply. 
• Global Market Share Opportunity: Indian chemical companies continue to benefit from diversification away from China by global buyers. Sudarshan, being a recognised pigment player, may be seen as a beneficiary if export demand revives.
• Positive Rating by CRISIL: The company’s short-term credit profile also remains strong, with CRISIL assigning an A1+ rating to its ₹50 crore commercial paper programme, indicating strong liquidity and repayment capacity.

Investor Insight

The recent institutional buying and sharp stock reaction have brought Sudarshan Chemical back into focus, but future performance is likely to depend more on business execution than block deal activity alone. Investors should note that specialty chemical companies are often cyclical in nature, with earnings influenced by raw material costs, export demand, pricing trends, and industrial activity. This means sentiment can improve quickly during recovery phases, but it can also remain sensitive to changes in global demand and margin movements.

Company Overview

Sudarshan Chemical Industries Limited is one of India’s leading speciality chemical companies and a globally recognised player in the pigments industry. The company manufactures a wide range of organic pigments, inorganic pigments, and effect pigments that are used in paints, coatings, plastics, inks, textiles, automotive finishes, and cosmetics. It is regarded as the world’s third-largest pigment manufacturer, highlighting its strong global positioning in a niche segment.

The company has a diversified business model with exports contributing significantly to revenue, supplying products to more than 85 countries across regions such as Europe, North America, Mexico, China, and Japan. Its product mix includes both specialty and non-specialty pigments, allowing it to cater to a broad range of industrial and consumer applications.

Apart from pigments, Sudarshan Chemical also operates an engineering business through its wholly owned subsidiary, Rieco Industries, which manufactures powder processing, pollution control, and bulk solids handling equipment. 

The company’s revenue rose by 215% from ₹666 crores in December 2024 to ₹2,103 crores in December 2025. Meanwhile, the reported EBITDA decreased to ₹38 crores in the same period due to the increase in employee costs and the it made a net loss of Rs. 116 Crores in the latest quarter.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.

The post Chemical stock jumps 8% after Nippon India MF and Theleme India increase their stake appeared first on Trade Brains.