STOCK WATCH
Dhanuka Pesticide (Code: 507717) (Rs.107.50) is a well-established manufacturer/ formulator of a wide range of popular pesticides in ECs, Granules, Wettables & Dust Formulations of Insecticides, Fungicides, Weedicides, PGR, Growth Stimulant and Wetting Agents. For FY06, its sales were marginally up at Rs.56 cr. but the net profit rose by 25% to Rs.4.20 cr. reports an EPS of Rs.21 on its tiny equity of Rs.1.98 cr. It declared Rs.4 as dividend (including Rs.2 as interim dividend) for FY06, which means a yield of 4% on its CMP. With good monsoons expected this year throughout India, it will report better numbers for FY07. The company has numerous technical tie-ups with reputed MNCs across the world and has recently decided to merge with itself an unlisted group company, ‘Northern Minerals Ltd.’, which will further strengthen its balance sheet. Buy on declines.
Due to government restriction on sugar exports, the share price of most of sugar companies have tumbled down sharply. Ponni Sugars (Erode) (Code: 532460) (Rs.63.45), which had hit a high of Rs.120 is now available around Rs.60. For FY06, its top-line grew by 55% to Rs.136 cr. whereas its net profit increased by 90% to Rs.11.40 cr. registering an EPS of Rs.14 on its equity of Rs.8.20 cr. and it declared 18% dividend. Besides, it is undergoing expansion to augment its crushing capacity to 3000 TCD from 2500 TCD. For FY07, it may clock a turnover of Rs.150 cr. and net profit of Rs.13 cr. and may post an EPS of Rs.16. Share price can easily touch Rs.100 in 12-15 months.
Panama Petrochem (Code: 524820) (Rs.84) is one of the leading manufacturers and exporters of petroleum specialty products like transformer oil, liquid paraffin, petroleum jelly, cable jelly, ink oil, rubber process oil and antistatic coning oil. Apart from an exclusive marketing tie-up with Lubcon, a German MNC, for marketing its range of specialized oil and grease products, Panama recently signed a five-year pact with Malaysia's Petronas to market and distribute its automotive lubricant `Syntium' in India. For FY06, its turnover grew by 50% to Rs.109 cr. and its net profit jumped 85% to Rs.6.50 cr. To cater the rising demand, the company is implementing Rs.30 cr. capex plan to increase its Ankleshwar and Daman capacity from the existing 35,000 TPA to 50,000 TPA. For FY07, it may report a top-line of Rs.150 cr. and bottom-line of Rs.8.50 cr. i.e. an EPS of Rs.18 on its diluted equity of Rs.4.76 cr. With the company making preferential allotment of 5 lakh shares at Rs.153, this scrip is a good buy at the current level.
Due to government restriction on sugar exports, the share price of most of sugar companies have tumbled down sharply. Ponni Sugars (Erode) (Code: 532460) (Rs.63.45), which had hit a high of Rs.120 is now available around Rs.60. For FY06, its top-line grew by 55% to Rs.136 cr. whereas its net profit increased by 90% to Rs.11.40 cr. registering an EPS of Rs.14 on its equity of Rs.8.20 cr. and it declared 18% dividend. Besides, it is undergoing expansion to augment its crushing capacity to 3000 TCD from 2500 TCD. For FY07, it may clock a turnover of Rs.150 cr. and net profit of Rs.13 cr. and may post an EPS of Rs.16. Share price can easily touch Rs.100 in 12-15 months.
Panama Petrochem (Code: 524820) (Rs.84) is one of the leading manufacturers and exporters of petroleum specialty products like transformer oil, liquid paraffin, petroleum jelly, cable jelly, ink oil, rubber process oil and antistatic coning oil. Apart from an exclusive marketing tie-up with Lubcon, a German MNC, for marketing its range of specialized oil and grease products, Panama recently signed a five-year pact with Malaysia's Petronas to market and distribute its automotive lubricant `Syntium' in India. For FY06, its turnover grew by 50% to Rs.109 cr. and its net profit jumped 85% to Rs.6.50 cr. To cater the rising demand, the company is implementing Rs.30 cr. capex plan to increase its Ankleshwar and Daman capacity from the existing 35,000 TPA to 50,000 TPA. For FY07, it may report a top-line of Rs.150 cr. and bottom-line of Rs.8.50 cr. i.e. an EPS of Rs.18 on its diluted equity of Rs.4.76 cr. With the company making preferential allotment of 5 lakh shares at Rs.153, this scrip is a good buy at the current level.
Ceekay Diakin (Code: 505923) (Rs.90) is a leading manufacturer of clutches for four wheelers and the LCV segment enjoying 32% market share of the OEM market. It is a supplier to most of the OEMs like Maruti, Eicher, Swaraj Mazda, Toyota, M&M, Tata Motors, GM and Honda. On the back of better performance by the auto sector, the company’s fortune has also improved significantly. For FY06, it clocked 27% higher turnover at Rs.86 cr. but the net profit jumped 136% at Rs.5.25 cr. leading to an EPS of Rs.13 on its equity of Rs.4 cr. For FY07, its EPS can shoot up to Rs.17. Belonging to the M&M group and being in such a fast growing sector, its share price can once again test its recent high of around Rs.150. A solid bet in the auto ancillary sector.
Belonging to the Williamson Magor group, Kilburn Chemical Ltd. (Code: 524699) (Rs.49.65) is the only manufacturer of Anatase Grade titanium dioxide in India apart from SAIL. It also manufactures and exports Ferrous Sulphate the by-product. Due to various tax benefits and for captive consumption, the company is putting up windmills for generation of electricity at a lower cost. On the back of lower provisioning for deferred tax, the company reported bumper profits for FY06. While its sales and operating profit reported a modest double-digit growth at Rs.63 cr. and Rs.12.55 cr. respectively, its net profit zoomed 150% to Rs.8.50 cr. compared to Rs.3.50 cr. last year. This translates into an EPS of Rs.11 on its equity of Rs.7.40 cr. It announced 20% dividend and the scrip is still trading cum dividend with an yield of 4%. Investors can buy it for decent short-term gains.
Belonging to the Williamson Magor group, Kilburn Chemical Ltd. (Code: 524699) (Rs.49.65) is the only manufacturer of Anatase Grade titanium dioxide in India apart from SAIL. It also manufactures and exports Ferrous Sulphate the by-product. Due to various tax benefits and for captive consumption, the company is putting up windmills for generation of electricity at a lower cost. On the back of lower provisioning for deferred tax, the company reported bumper profits for FY06. While its sales and operating profit reported a modest double-digit growth at Rs.63 cr. and Rs.12.55 cr. respectively, its net profit zoomed 150% to Rs.8.50 cr. compared to Rs.3.50 cr. last year. This translates into an EPS of Rs.11 on its equity of Rs.7.40 cr. It announced 20% dividend and the scrip is still trading cum dividend with an yield of 4%. Investors can buy it for decent short-term gains.
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