This smallcap shares zoom 19% as German competitor Heubach files for bankruptcy

On the back of the bankruptcy filing, Sudarshan Chemicals stands to gain meaningful market share in the export as well as domestic markets, said analysts.

"Heubach’s insolvency shall create a void in the interim period during which Sudarshan can strengthen its market presence across the exports market. Even if Heubach comes out of insolvency, Sudarshan can gain some irreversible market share. Sudarshan’s specialty portfolio is also strengthened in recent times with new products and validations/approvals thereof," said Centrum Broking.


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Heubach GmbH has filed an application for the opening of regular insolvency proceedings over its assets with the competent insolvency court in Braunschweig and, at the same time, applied for the jurisdiction of the Braunschweig insolvency court as the court for the German subgroup of Heubach.

The court is expected to appoint an insolvency administrator to examine the possibility of continuing business operations and possible options for restructuring and/or selling the business in due course.

"We continue to believe that challenges like consolidation in the pigment industry, (permanent shutdowns in capacities in Europe), high inflation in developed economies, weak geopolitical scenario, sharp volatility in commodity prices, and supply chain disruptions are expected to hit mid-sized and small pigment players resulting in benefit to major players like Sudarshan Chemicals. We maintain our positive stance on the company," Sandeep Abhange, Research Analyst at LKP Securities said.

In the meantime, Heubach's domestic unit faced selling pressure with crashing 18% to day's low at Rs 382 on the BSE.

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