First of all, let me clarify that whatever views that I post here are my personal views on quarterly results posted by the company.
Please speak to your financial advisor before taking any actions on any of the below mentioned names.
The views on result expressed below are mostly about company's performance rather than evaluating whether the company's price is fair or not.
1) Ajanta Pharma:
Another strong set of numbers by Ajanta Pharma. The price movement before the quarter indicated that most investors are under impression that their Africa revenues would be affected by slowdown in their currency. However, company duly informed that all the transactions in african countries are happening in USD, as far as what I understood. The same thing got reflected in their results, with revenue growth in african countries turned out to be 40% (probably the best among their geography :)). This could be one of the reason why the price didnt fell much in last week carnage in stock markets. Not sure about that though!!! However, in our discussion here, we are least concerned about stock price movements. In terms of growth yoy, company showed 16% jump in sales and 20% jump in net profit.
Net margins continue to remain near 25%, which is great. The company in their filing has also mentioned that their new facility at Dahej has started taking regulatory filing batches, and the company has started contruction of their new plant at Guwahati, which is expected to be operational by March next year.
All in all, I am still positive about the company and their growth story.
2) Granules India:
Good set of numbers by the company, as net sales were up 8% and profit was up by 15%. The company mentioned that some of their product's pricing is directly linked to raw material prices. Hence with falling crude, they were able to post sales growth of only 8%. The good thing that margins have continued to impress over past 6-7 quarters, and management is still confident of improving it further. The management is expecting 15% revenue growth in Q4, and 15-20% growth in FY'17 over FY'16. If these numbers are delivered and that too, with further improvement in margins, it could be great for the company. The net profit by the next year, could very well be above 150 Crs.
One more positive news came in for the company, which stated that company will start trading in F&O segment from 26th Feb. We can see even more participation from FIIs then. Not sure of its impact on price, especially in current circumstances. :)
3) DHFL & Can Fin Homes:
The overall finance sector has been under tremendous pressure, and most of the companies have been affected because of that. Still, in my opinion, both DHFL and Can Fin Homes continue to look good based on their strong numbers. When discussed here for the first time, DHFL was already a midcap name and Can Fin Homes was small cap co then. Considering that, it was expected that Can Fin Homes is likely to give more returns if conditions are favorable. That was exactly what happened. Now since both are decent size companies, they are expected to follow the market trend in terms of price movement, but their performance is likely to be good, and likely to be better than some of the peers in the sector.
However, considering the current scenario, it is advisable that you take inputs from a finance expert before taking any decisions on these two names, as my knowledge in finance sector is limited.
4) Suven Life Sciences:
This company can be considered as one, where we had plenty of expectations and which has disappointed big time, since past few quarters. Obviously, when we started discussion, it was trading cheaply at 24 Rs. Since then the returns may be good, but their performance off-late has not been upto the mark, and which has reflected in their market cap reducing almost 40% from the highs.
However, they are in business, where their successful research turning to commercial returns could take a bit of time, and hence one has to show patience, if one wants to remain invested here. Lots of commercialization of their products is likely in next 2-3 years.
One can refer to the investor presentation published by the company which is quite elaborative:
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/B31E1ECC_932E_434A_9C79_EB18ACAD11FF_115122.pdf
The decision in this company can be taken based ones own conviction, as the numbers in this company is not as predictable as may be something like Ajanta Pharma.
5) Cera Sanitaryware:
The company even in the worst of times, is still able to post more than 10% growth in sales, which is commendable. The revenues this quarter were up by 12% and net profit up by almost 25%. The company has attributed the current slump in demand, as a reason of posting lesser growth, as they had guided for 20-25% revenue growth for FY'16, which doesn't seem to be happening after the end of first 3 quarters. The company as usual, gets good amount of government orders in Mar quarters, which is likely to aid growth this time also, as per management. On top of it, their recent acquistion of Anjani Tiles, is about the commence production in middle of march, which will aid some growth for the next year. Till then, it seem, we have to wait for improvement in macros, for company to get back to their historical growth every quarter.
Again, it can be considered as a conviction bet, especially in current circumstances. If one believes, that schemes like housing for all, and few others will succeed, then it will definetely lead to better performance from this sanitaryware giant.
6) Dhanuka Agritech:
Finally, some respite for this agri company, as after 2-3 very flat quarters due to monsoon deficiency, it has finally got back to growth days. Revenues this quarter were up by 15% and net profit was up by 3%. The environmental conditions in India has kept the company's growth in check this year, but still they were able to post decent growth this quarter.
Once we have a good monsoon, the company would be one of the bigger beneficiaries.
The company's 4th facility at Keshwana, Rajasthan is expected to be operational very soon.
Their distributor network has more than doubled in past 8-9 years, which is good to see.
The company operates in one of the better sub-sector in agro-chemical space, which is plant protection, where the consumption is still lowest in India as compared to other countries. We all are aware of how much crop is destroyed by Insects, Fungus and Weeds every year.
All in all, it seems the company has very high capability of delivering good numbers! Let's hope for some respite from rain gods this time!!!
More result updates to follow!!
Discloure:
I am not a research analyst, nor an investment advisor. Through this post, I am only putting my views, and which has nothing to do with any action that can be taken by readers on any specific company.
Please speak to your financial advisor before taking any actions on any of the below mentioned names.
The views on result expressed below are mostly about company's performance rather than evaluating whether the company's price is fair or not.
1) Ajanta Pharma:
Another strong set of numbers by Ajanta Pharma. The price movement before the quarter indicated that most investors are under impression that their Africa revenues would be affected by slowdown in their currency. However, company duly informed that all the transactions in african countries are happening in USD, as far as what I understood. The same thing got reflected in their results, with revenue growth in african countries turned out to be 40% (probably the best among their geography :)). This could be one of the reason why the price didnt fell much in last week carnage in stock markets. Not sure about that though!!! However, in our discussion here, we are least concerned about stock price movements. In terms of growth yoy, company showed 16% jump in sales and 20% jump in net profit.
Net margins continue to remain near 25%, which is great. The company in their filing has also mentioned that their new facility at Dahej has started taking regulatory filing batches, and the company has started contruction of their new plant at Guwahati, which is expected to be operational by March next year.
All in all, I am still positive about the company and their growth story.
2) Granules India:
Good set of numbers by the company, as net sales were up 8% and profit was up by 15%. The company mentioned that some of their product's pricing is directly linked to raw material prices. Hence with falling crude, they were able to post sales growth of only 8%. The good thing that margins have continued to impress over past 6-7 quarters, and management is still confident of improving it further. The management is expecting 15% revenue growth in Q4, and 15-20% growth in FY'17 over FY'16. If these numbers are delivered and that too, with further improvement in margins, it could be great for the company. The net profit by the next year, could very well be above 150 Crs.
One more positive news came in for the company, which stated that company will start trading in F&O segment from 26th Feb. We can see even more participation from FIIs then. Not sure of its impact on price, especially in current circumstances. :)
3) DHFL & Can Fin Homes:
The overall finance sector has been under tremendous pressure, and most of the companies have been affected because of that. Still, in my opinion, both DHFL and Can Fin Homes continue to look good based on their strong numbers. When discussed here for the first time, DHFL was already a midcap name and Can Fin Homes was small cap co then. Considering that, it was expected that Can Fin Homes is likely to give more returns if conditions are favorable. That was exactly what happened. Now since both are decent size companies, they are expected to follow the market trend in terms of price movement, but their performance is likely to be good, and likely to be better than some of the peers in the sector.
However, considering the current scenario, it is advisable that you take inputs from a finance expert before taking any decisions on these two names, as my knowledge in finance sector is limited.
4) Suven Life Sciences:
This company can be considered as one, where we had plenty of expectations and which has disappointed big time, since past few quarters. Obviously, when we started discussion, it was trading cheaply at 24 Rs. Since then the returns may be good, but their performance off-late has not been upto the mark, and which has reflected in their market cap reducing almost 40% from the highs.
However, they are in business, where their successful research turning to commercial returns could take a bit of time, and hence one has to show patience, if one wants to remain invested here. Lots of commercialization of their products is likely in next 2-3 years.
One can refer to the investor presentation published by the company which is quite elaborative:
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/B31E1ECC_932E_434A_9C79_EB18ACAD11FF_115122.pdf
The decision in this company can be taken based ones own conviction, as the numbers in this company is not as predictable as may be something like Ajanta Pharma.
5) Cera Sanitaryware:
The company even in the worst of times, is still able to post more than 10% growth in sales, which is commendable. The revenues this quarter were up by 12% and net profit up by almost 25%. The company has attributed the current slump in demand, as a reason of posting lesser growth, as they had guided for 20-25% revenue growth for FY'16, which doesn't seem to be happening after the end of first 3 quarters. The company as usual, gets good amount of government orders in Mar quarters, which is likely to aid growth this time also, as per management. On top of it, their recent acquistion of Anjani Tiles, is about the commence production in middle of march, which will aid some growth for the next year. Till then, it seem, we have to wait for improvement in macros, for company to get back to their historical growth every quarter.
Again, it can be considered as a conviction bet, especially in current circumstances. If one believes, that schemes like housing for all, and few others will succeed, then it will definetely lead to better performance from this sanitaryware giant.
6) Dhanuka Agritech:
Finally, some respite for this agri company, as after 2-3 very flat quarters due to monsoon deficiency, it has finally got back to growth days. Revenues this quarter were up by 15% and net profit was up by 3%. The environmental conditions in India has kept the company's growth in check this year, but still they were able to post decent growth this quarter.
Once we have a good monsoon, the company would be one of the bigger beneficiaries.
The company's 4th facility at Keshwana, Rajasthan is expected to be operational very soon.
Their distributor network has more than doubled in past 8-9 years, which is good to see.
The company operates in one of the better sub-sector in agro-chemical space, which is plant protection, where the consumption is still lowest in India as compared to other countries. We all are aware of how much crop is destroyed by Insects, Fungus and Weeds every year.
All in all, it seems the company has very high capability of delivering good numbers! Let's hope for some respite from rain gods this time!!!
More result updates to follow!!
Discloure:
I am not a research analyst, nor an investment advisor. Through this post, I am only putting my views, and which has nothing to do with any action that can be taken by readers on any specific company.
Any views on Patels airtem Q3 results - looks like sector degrowth impacting thi sone also.
ReplyDeleteYes, there is a major slowdown in the sector..
DeleteOnly positive is improvement in margins..
Right now, I don't have any conclusion, but to wait & watch if things improve going ahead...
Please present your thoughts about results of Dynemic Products as well.
ReplyDeleteResults are not at all coming as per the expectations, and non payment of dividend last year was a big negative, inspite of coming making an EPS of 8.25 in FY'15.
DeleteHowever, the company still trades at a P/E below 10, and there were few shares picked up by the promoters from open market in past 2-3 months, which can be considered as minor positives.
Finally, you have to take your own decision, but if you ask me personally at this moment, I would be neutral on this counter.
Hi , Would like to check if u have study pattern glass companies and their growth /competition . Please advise if u have some idea
ReplyDeleteAnything specific that you like about those companies... Just asking for my knowledge...
DeleteAs such, I am not into any such companies, but can take a look..
Sir Any Views on Kanoria Chemicals & Gujarat Ambuja Export?
ReplyDeleteI feel both these companies going ahead would be Multibaggers.
If u can jus give me an overview for both these companies it would be great. Thanks a Lot!
Disc: Holding Good Qty in Both.
Regards,
Vivek
Hi Vivek,
DeleteI am not strictly tracking Kanoria Chemicals. Totalview was tracking it earlier, if I remember currently. May be he can add something here.
Gujarat Ambuja Exports is one of the better company in its sector.
Thanks a Ton for the Reply. I Hope Totalview gives his inputs on Kanoria. Its a Gr8 company and his views can help your followers and adds to my confidence in holding this Gem.
DeleteGujarat Ambuja has been testing my patience since last 1.5 years. I hope it pays going ahead.
Hey Kunal, any specific reason behind recent fall in Suven life..back to 150 range. Is it good to consider it now?
ReplyDeleteReason is almost as mentioned above..
DeleteIf you look at Mar'14 numbers, they were able to post 144 Cr net profit on 510 Cr sales. This was some 100% growth in sales and 400% growth in net profit.
All the rise in stock prices was due to such numbers, and somewhere investors were confident of company being able to post atleast 15% growth going ahead if not more, which is not coming.
The only hope is Q4 now, as the management has guided a decent growth coming back. Till then, we will have to wait and watch..
However, if you are looking at the bigger picture, I have mentioned few details in above, regarding their patents and their commercial benefits.
Hope that helps!!
hi kunal sir,
ReplyDeletecan you explore your view about roto pumb, unichem lab, ekc & porwal
Unichem lab is a very good company, fundamentally.
DeleteNot tracking others..
In case of porwal, I feel that in such a sector, you should better look for some company which already has good presence, otherwise, predicting the performance becomes too difficult.
Obviously, rewards can be huge, but that's where concept of risk vs reward comes in.