................................................................................................................. counter
!!! W E L C O M E !!!
In INDIA, people generally relate to stock market as “EASY MONEY” or “SATTA BAZAAR”. For them it’s purely a GAME or matter of sheer LUCK and nothing more than that. But seldom do they know, by following certain PRINCIPLES and taking INFORMED decision, this same platform has the power to take them from rags to riches. No doubt, it has a certain amount of RISK attached to it. But every business or investment has it. What more, the Finance Ministry has already made the long term capital gain as TAX FREE whereas the short term capital gain is taxed at merely 10%. On the economic front, India’s GDP is growing and is expected to grow at scorching pace of more than 8%. Unfortunately, even today our market is being ruled and dominated by FIRANGI’s money. But I can see, the day is not far when our general PUBLIC will change its perception and start putting MOST of their savings in equities as an ** Investment **.
Remember, "K N O W L E D G E" and "P A T I E N C E" are the key to success.
Page copy protected against web site content infringement by Copyscape
AddThis Social Bookmark Button Add to Technorati Favorites Join My Community at MyBloglog! ...<< Top Blogs >>
SAARTHI

Sensex (LIVE- Intraday)

Sensex (LIVE- Intraday)

Friday, September 16, 2005

GSFC - Rs.140.50

Incorporated in 1962 Gujarat State Fertilisers & Chemicals Ltd. (GSFC) was promoted by the Government of Gujarat to manufacture fertilizers and heavy chemicals. Today, it is the largest producer of caprolactum and also has one of the largest capacities in diammonium phosphate. Currently GSFC manufactures chemicals, fertilisers, petrochemicals and other allied products such as urea, caprolactuam, ammonium sulphate, diammonium phosphate, ammonia, sulphuric acid, argon gas, etc. apart from producing nylon-chips and melamine. Recently, GSFC commercialized biotechnology by offering high quality tissue culture plants of banana and papaya to the farmers in Gujarat, Maharashtra and MP. It has also entered into marketing of bio-pesticides in order to propagate organic farming.

GSFC’s manufacturing facilities are dispersed over four units at Fertilizernagar (Baroda), Sikka (Jamnagar), Kosamba (Surat), and Nandesari (Baroda). It has a strong sales supporting network comprising 300 warehouses across the country connected through well-planned routes to reach the interiors and a strong marketing network of 140 Farm Information Centre-cum-Depots, where products & information are made available to farmers by more than 200 experienced agro-professionals. Currently, GSFC has an installed capacity to produce 70,000 MTPA of caprolactum, 3,64,000 MTA of urea and 6,54,000 MTA of diammonium phosphate and 15,000 MTA of melamine. Importantly, GSFC has made supply contracts with Gujarat State Petroleum Corporation (GSPC) and Gujarat Gas Company (GGCL) for natural gas and with GAIL for Liquefied Natural Gas (LNG). This gradual shift from naphtha as a feedstock to natural gas will lead to better operating efficiency and lower cost of production.
GSFC has made significant investments in other State government promoted companies like GNFC, GACL, GIPCL and other unlisted companies like GSPC etc. These value of these investments works out to be more than Rs.50~60 per GSFC share at current market price (CMP). But the real value will be much higher if these companies are actually divested. GSFC itself is one of the 12 State candidates in the disinvestment list. For FY05, its turnover grew by 25% to Rs.2606 cr. and profit before tax jumped 500% to Rs.252 cr. due to better operating margin and lower interest cost. NP stood at Rs.138 cr. due to higher deferred tax provisions leading to an EPS of Rs.17. With greater emphasis on the agriculture sector in the Union Budget, increased availability of credit to the farming community and with good industrial growth, GSFC can report Sales of around Rs.2750 cr. and NP of Rs.200 cr. leading to an EPS of Rs.25 for FY06. Investors are strongly recommended to buy this scrip at current levels with a price target of Rs.200 (40% return) in 9~12 months.

No comments: