AVT NATURAL PRODUCTS LIMITED_BRIGHT FUTURE

BACKGROUND

-Promoted by AV Thomas Group specialising in extraction of colors and flavours from Natural Resources set up in 1996

-Marigold cultivation in 35000 acres of land with 100000 metric tonnes production with 30000 farmers on contract.

-Located in Kochi, Kerala and Post harvest Processing centres in Tamil Nadu and Karnatka.

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POSITIVES

-AVT is in Proximity to the source raw materials and logistical advantage of import and export facilities with sea,air and road within its reach.

-Revival of feed grade price and in food grades,volumes has been dropped to meet client requirement

-Focus on innovation developing high yield hybrid for marigold production will be cost effecient

-in spices,high value niche products has paid off well

-made investments in Decaf business

-instant tea business is a challenge but since it's first supplies,future looks bright

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Negatives

-Volatility of rupee is not encouraging

-has made new investments,time is required to establish in those markets

Recommended at current price of 30.80 rs

NAVNEET EDUCATION LTD Proven winner Stock , holds a lot of value!!

BACKGROUND

-Set up in 1959 is an educational syllabus based content provider in print and digital medium

Manufacturer of Scholastic paper stationary and publisher of general and Children books

-Published more than 5000 titles

-Products sold under the names 'Navneet',Vikas,Gala,Grafalco,FfUunN and Boss.

-State of Art Manufactruing facilities in Virar,Guma,Dantali,Silvassa.

-Ventured into Digital Learning with  eSense in 2009,used by 15500 classrooms uptil 2015 in Gujarat and Maharashtra.

-Forayed into Pre School Business under the name 'Leapbridge Education' with 7 Pre schools in Pune and Mumbai

-Acquired a minority stake in School Management company owning 61 state board schools in Andhra Pradesh and 12 cbse schools in Maharashtra.

POSITIVES

-Stationary segment grew 17% year on year basis

-Digital learning will continue to perform better with more penetration in state board schools in Gujrat and Maharasthra.

-Dominant Market share in Western India of approx 65%

-Exports of paper stationary adding up to volumes

NEGATIVES

-Rising Input cost ever increasing raw material costs

-Companies relies on intellectual property rights and propritory right which may not be adequately protected under current laws and the industry is prone to defamation suits etc

-Highly competitive industry with lot of changes happening every moment and need to adapt those changes to remain in business.

Highly Recommended at current market price of 94 rs for medium to long term.

NARMADA GELATINES Value Pick Multi Bagger

BACKGROUND

-Set up in 1961 also known as shaw wallace gelatines ,located in Madhya Pradesh

-Does Manufacturing of Ossein and Gelatines abd by product di calcium phosphate 

-Gelatine is natural animal protein composed of various amino acids required for human nutrition.

-Wide usage in pharmaceutical,edible,photographic and other technical industries.

-The Company Was awarded Capexil award for gelatine exports

-Sound Management team including a director of gelatine manufacturing association of asia pacific



STRENGTHS

-Gelatine is a only natural gelling protein of commercial inportance ,there is no satisfactory alternative or substitute for gelatine.

-Rapid growth of pharmaceutical industry in india and across the globe which drives the gelatine industry.

-Growing use of gelatine in Food and beverages  and Cosmetics industries

-The office international des epizooties ,paris  contiued the status of india as 'Negligible risk' as far as BSE categorisation is concerned which is a good opportunity for this industry.

-Strategically located in Madhya Pradesh close to its essential inputs .

-Total Revenues increased from 87 crores in 2009-10 to 140 crores in 2014.

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NEGATIVES

-Upward trend in raw materials and non availability of good quality raw materials

-import of poor quality gelatin in India which is a health concern too and affects proper price realisation for domestic players

-Alternatives for the by-product DCP(Di Calcium Phosphate)are emerging could be a concern in future

-Growing regulatory issues in food and Pharma industry directly affects players in this industry.



Recommended at current market price of 145 for long term .

Stock Updates

Sunil Hitech-

Just after 2 months of recommendation at rs 150 ,it reached Rs  314  (doubled) on 7th on July currently trading at 275 still recommended to hold.

Waterbase Ltd-

Recommended at rs 49,Reached  Rs 91(appreciation of 80%) on 15th of July,currently trading at rs 84 still recommended to hold.

All Other shares still recommended to hold.

JINDAL STAINLESS-Growth Unlimited

BACKGROUND

Jindal Stainless, a part of the $ 18 billion USD, OP Jindal group is the largest integrated 

manufacturer of stainless steel in India and is ranked amongst the top 10 stainless steel manufacturers in the world, with a capacity of 1.8 million tons.

JSL product range includes: Ferro Alloys, Stainless Steel Slabs, Blooms, Hot Rolled Coils, Plates and Cold Rolled Coils/ Sheets, Stainless Steel Strips for Razor Blade Steel and Coin Blanks for mints in India & EU.

FINANCIAL PERFORMANCE JSL’s (Standalone) gross revenue for the financial year ended 31st March, 2014 at `12,942 crore as against `11,091 crore in fy 12-13, has been highest ever, a growth of 17% year-on-year, mainly due to increased volume of sales at the new plant at Jajpur. Exports sales surged to `3,482 crore from `3,220 crore in fy 12-13 with year-on-year growth of 8% and Domestic sales grew by 20% to `9,460 crore from `7,871 crore in fy 12-13. Profit before depreciation, interest and taxes stood at `886 crore as against `615 crore in fy 12-13.

POSITIVES

Today with a crude stainless steel production of 3 mmt, India ranks as the third largest producer and second largest consumer of Stainless Steel.

Over the past 5 years imports from China have gone up by close to 700%. Apart from dumping activities, large scale circumvention of import duties is also rampant. But, with new government promising to focus on growth of domestic manufacturing and on the infrastructure sector,stainless steel sector will get a boost.

Strong sales push in hitherto less penetrated market segments like nuclear power, industrial, process industries, oil & gas and kitchenware segments in domestic market contributed significantly to this growth.Special drive has been organized in hitherto untapped segments like elevators, pumps, plumbing, sugar, rice and petrochemical industries.

Promoters stake has increased.

NEGATIVES

Company has low interest coverage ratio.

Company has a low return on equity of -28.12% for last 3 years.

Contingent liabilities of Rs.5134.92 Cr.

Promoters have pledged 71.84% of their holding

Highly recommended at cmp 41 price right for medium to long term perspective.

NITIN FIRE PROTECTION - Value Pick Multibagger

Nitin Fire Protection

Background

-Promoted by Nitin Shah manufacturing Fire extinguishers and fire fighting equipments

-Existence in fire protection space since 29 years, have expanded foot hold not only in India but also in United Arab Emirates, South Asia & Europe.

-NFPIL is associated with Beijing Tianhai Industry Company Ltd. (B.T.I.C), China for contract manufacturing of High Pressure Seamless Cylinders for Industrial Gases(BTIC got manufacturing capacity of 1.5 million  cylinders per Annum ) 

-Diversification in CNG by forming Nitin Cylinders Ltd., Manufacturer’s of High Pressure Seamless Cylinders, having manufacturing facility at Vishakapatnam SEZ, Andhra Pradesh and Divestment joint venture with Worthingtion Industries limited 

-Acquired 40% stake in a Dubai based fire protection company ‘NEW AGE COMPANY – LLC’ 

Major Clients

INOX Air Products, Indraprastha Gas Limited (IGL), BOC, Praxair, Air Liquide etc.

Positives

-large scale fire protection system installation  across india (5000 direct and 20000 indirect)

-Revenue increase by 44% post Middle East venture

- Factors contributing growth 

A) Increasing awareness through media for protection from fire 

B) Threat of heavy losses due to fire 

C)Strict rules by Governement for fire protection

-55% of revenue comes from UAE 

world expo 2020 will be held in UAE will push the growth further in this market.

Negatives

-Despite a lot of media,ignorance is still there among small and medium companies and cooperative residential societies which hinders it's growth 

Conclusion

At Cmp 36.5,it's superbly attractive !!a definite buy!!

Nikhil Adhesives - WoW Value Pick

 NIKHIL ADHESIVES 

Background 

-Manufacturing various types of polymer emulsions that are used for different applications. 

-In this business for over 28 years and has three manufacturing units located at Dahanu (Maharashtra), Silvassa(Gujarat) and at Dahej(Gujarat). 

-The current production capacity is 60000T p.a. which can be enhanced. 

-Acquired the emulsion business of Mafatlal Dyes & Chemicals Ltd. in 2003 and its products are sold under the brand name Mahacol,Emditex, Emdilith, Emdicryl

Positives/Strengths

-Strengthened Brand Image resulting in sales growth of 26%

-Addition of capacity at Dahej plant lead Production capacity increase by 13%

-Backward integration by manufacturing Plasticizers important ingredient of emulsions

-Dividend payout is at 32.5% which is very satisfactory.

Negatives/Risks

- Fluctuating Foreign Exchange lead to loss due to import of raw material

-Slow pace of growth in Construction Sector 

-Increase in the cost of Vinyl acetate monomer important raw material for manufacturing emulsions.

Conclusion

Highly recommended at current market price of 33.5