Ashish Kacholia’s Portfolio Penny Stock: FCL Discussed the Strategic Acquisition of CrudeChem Technologies; Details Inside!
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The stock is up by 26.8 per cent from its 52-week low of Rs 19.21 per share and has given multibagger returns of 370 per cent in 5 years.
In a landmark move for its international growth strategy, Fineotex Chemical Limited (FCL) has announced the acquisition of a controlling 53.33 per cent stake in the CrudeChem Technologies (CCT) Group, a leading U.S.-based specialty oilfield chemicals ecosystem. The acquisition, valued at approximately USD 11.5 million, was executed through FCL’s subsidiary, Fineotex Biotex Healthguard FZE. With CCT maintaining a combined annual revenue of USD 68 million and a robust presence in key Texas oilfield hubs like Midland and Brookshire, this transaction is designed to be immediately EPS-accretive. The deal not only establishes a significant manufacturing and R&D beachhead for Fineotex in the United States but also aligns with the company's ambitious vision to build a USD 200 million global oilfield specialty chemicals business within the next few years.
The strategic rationale behind the acquisition centres on the powerful synergy between Fineotex’s manufacturing excellence and CrudeChem’s advanced technical capabilities. CrudeChem brings to the table a portfolio of mission-critical fluid additives, ESG-compliant solutions, and deep-rooted relationships with Tier 1 global energy producers and oilfield service providers. By integrating CCT’s Texas-based R&D infrastructure with Fineotex’s expertise in formulation chemistry, the group aims to accelerate technology transfer and the co-development of high-performance chemistries for reservoir stimulation and water treatment. This integration is particularly timely, as the North American oilfield chemicals market represents an estimated USD 11.5 billion opportunity in 2025.
During a recent investor conference call, Executive Director and CFO Sanjay Tibrewala emphasised that the acquisition was funded entirely through internal accruals, leveraging Fineotex’s strong cash position of over Rs 300 crore. Addressing analyst inquiries regarding the valuation, management clarified that the deal is not a distressed asset purchase but a strategic alliance where Fineotex provides the necessary growth capital to scale CCT’s substantial order pipeline. Looking ahead, Fineotex has already secured a commitment to increase its stake to 78.33 per cent by 2028, signalling a long-term dedication to the U.S. market. The company plans to consolidate CCT's financials starting in late 2025, with a primary focus on driving a 25 per cent CAGR within this new segment through aggressive cross-selling and capacity expansions in both the U.S. and the Middle East.
About the Company
Fineotex Chemical Limited is a leading Indian multinational producer of specialty performance chemicals, offering sustainable, technology-driven solutions for industries such as textile and garment processing, home care, water treatment and oil & gas. With advanced manufacturing facilities in Ambernath (India) and Selangor (Malaysia) and a new plant planned for Ambernath, Fineotex is committed to innovation and sustainability. The company serves clients in approximately 70 countries through an extensive network of over 103 dealers and distributors in India, supported by an NABL-accredited R&D laboratory. Fineotex consistently delivers innovative, reliable and eco-friendly solutions to meet global market demands.
Fineotex Chemical delivered a strong quarterly performance, seeing consolidated total income rise 15 per cent quarter-on-quarter to Rs 146.22 crore, fuelled by solid results in its textile chemicals and oil & gas segments. This operational efficiency was evident with an 18 per cent increase in EBITDA to Rs 25.20 crore and a 24 per cent jump in net profit to Rs 25.03 crore, alongside the successful completion and commissioning of a new Rs 60 crore manufacturing facility that adds 15,000 MTPA capacity. However, the company's full fiscal year 2025 results showed a decline compared to FY24, with net sales dropping to Rs 533 crore from Rs 569 crore and net profit decreasing to Rs 109 crore from Rs 121 crore.
The company has a market cap of over Rs 2,700 crore with an ROE of 18 per cent and an ROCE of 24 per cent. A Guru Investor, Ashish Kacholia holds 2.59 per cent stake in the company as of September 2025. The stock is up by 26.8 per cent from its 52-week low of Rs 19.21 per share and has given multibagger returns of 370 per cent in 5 years.
Disclaimer: The article is for informational purposes only and not investment advice.