Sukhjit starch and chemicals is one of the largest
manufacturer of starch and starch derivatives in
. Company has four units one each in Punjab, India
West Bengaland Himachal.
Company’s products are widely used in industries
like Confectionery, Bakery ,Preserved food,
Baby foods,Ice creams..etc. All of these
industries are closely related with direct
consumer spending. Company is a preferred
supplier of well known firms like Wrigley
India Ltd., Dabur India Ltd., Perfetti
India Ltd.,Godrej, Parle, and Cadbury.
Citing the vast scope in consumer industries,
company is now planning to start another
Greenfield plant near the existing site at
West Bengal with a capital outlay of Rs.50 Cr.
Entire amount for the expansion will be funded
through term loans and internal accruals.
For the last financial year company posted a
turnover of Rs.259 Cr and a net profit of
Rs.15 Cr with an EPS of Rs.20/-. Sukhjit also
declared a dividend of 60% for its Rs.10/-
FV shares.It is expected to perform even
better in coming years. Open market purchase of
shares by promoters are also a positive factor.
A decent medium to long term BUY at current level
of Rs.169/- which is at a price earning multiple
of 8.5. Keep an eye on maize prices which is the
raw material of the company and prone to
wild fluctuations due to monsoon effect.