Saturday, October 23, 2010
Deepak Nitrite is a Baroda Based company manufacturing Organic,Inorganic ,Fine and Speciality chemicals.Its product list covers Sodium Nitrite,Methoxamyne,Resorcinol,Xylidine, Acetoxime, Alkali Blue, Benzotriazole, N-O-Alkylated Hydroxylamines..etc.These products are mainly used in the manufacturing process of Agrochemical Intermediaries,Bulk Drugs, Brightning Intermediaries and Rubber Chemicals.DNL is India’s largest manufacturer of Diamino Stilbene Disulfonic Acid which is using for manufacturing Optical Brightning Agents..Last year company started the work of a Greenfield Chemical project in Gujarat which will increase its capacity substantially going forward. What catching our attention in this company is its recent launch of Fuel Additive Products. These products are used for improving the quality and efficiency of fuels and make it latest Euro compliant . Company’s products from this division is expected to play a crucial role in India’s transformation from Euro 1 to Euro II and Euro IV standards .Company already got orders from domestic refineries and expected a turnover of around Rs.75 Cr from this division by next financial year. It is sure ,Government will eventually make Euro Compliance to all cities in not so distant future. This will open huge opportunity for the company going forward. In the financial front company has posted an EPS of Rs.22/- and declared a dividend of 50% in last FY.The first quarter of this FY was even better and it is expected to improve its performance going forward due to the overall improvement in the user industries of its products.Currently DNL is trading at Rs.191/- .Medium to long term investors can BUY at current level.