Saturday, June 11, 2011

ADF FOODS - BUY







                                                                                    









                                                                                                                                                                                                                              
ADF Foods is a manufacturer of processed food items like pickles,pastes, chutneys, ready-to-eat curries, frozen parathas, frozen snacks and frozen vegetables ..etc.
Company having two production facilities - one in Maharashtra and other in Gujarat. 95 % of the total income of the company is currently from  exports.  Its popular brands includes 'ASHOKA' ( ready-to-eat curries (Heat & Eat), Frozen Foods (Indian Breads & Snacks), pickles, condiment pastes, mango pulp/slices, chutneys, pappadums, IQF (Individually Quick Frozen) ready-to-cook vegetables, and Microwaveable rice ) 'CAMEL' ( Curry powder and Pickles) 'AEROPLANE'(Chutney,currey powder,Pickles,Flavored water) 'TRULY INDIAN'(cooking sauces,cooking pastes, canned food items,ready to eat curries..etc) 'SOUL' ( Ready to eat curries,pickles,mango chutney) .Among these brands ,'SOUL' is exclusively launched in Indian market in last financial year and got good response.Company is adding new countries in its export list every year and also planning to increase the local sale in the years to come.Changing life style of Indians are now favoring ready to eat products and the sales graph of these type products are climbing very well.Such a change in the attitude of public will surely help the companies like ADF.Now company is aiming a turnover of Rs.500 Cr in 5 years.ADF is planning to introduce international cuisine in ready-to-eat formats under the 'SOUL' brand .It is planning  a capex of around Rs.45 Cr to expand production and distribution facilities in a phased manner in next few years. To reduce the cost pressure of its raw materials company have started contract farming recently. Earlier there was some disputes among family members about the brand names of the company which affected its growth earlier ,but it resolved now. Company's recent efforts to introduce more products under new brands are expected to bring more business.Active buying of shares from open market by promoters are also a confidence booster. For the FY 2011 ,company posted a turnover of Rs.112 Cr and a net profit of Rs.18 Cr .On an equity base of Rs.20 Cr ,annualised EPS is close to Rs.9/- Company also having an uninterrupted dividend record for the past five years. It is a fact that its share price in moving in a narrow range for the past many months, but there is every chance for a decent re rating going forward from CMP of Rs.60/- level

15 comments :

  1. what happened?
    You have been so helpful ans responsive.
    Why u r not answering my queries related with TCI dev and Jubliant ind.s(your recom).
    I done have doubt about ur recom as I know Jubliant Ind.s has got HUGE CASH. But please answer the queries.

    ReplyDelete
  2. co. has made an investment of 18cs. in a loss making co. named Power Brands whose annual sales is only abt 1.8 lacs !!!

    ReplyDelete
  3. Dear Sameer

    I am not tracking TCI Developers and in general land bank stories are not attracting me .Neither positive nor negative on it. Regarding Jub.Ind. I think there may be some more value unlocking in future even if the company starts new divisions now.

    ReplyDelete
  4. Dear Jatin Soni

    I think the cost of that mistake is already discounting at the current price.

    ReplyDelete
  5. what are your thoughts on Vinati organics?

    ReplyDelete
  6. Great Company in the making. Buy below 57

    ReplyDelete
  7. Dear Sir,

    Please advise which one to buy for long term - Wimplast or Tokyo Plast looking at their current valuations.

    ReplyDelete
  8. hi sir thanks for ur valuable advice i have taken position in aunde india for long term -- i wanted to ask about ur previous recommendation gandhimathis appliance -- should i take position now after it surged losed to 10 % today or should i wait -- plz reply on this query as i am waiting for ur advice

    ReplyDelete
  9. On Thursday, March 18, 2010 you recomended the following scrip.
    - SIKA INTERPLANT SYSTEMS @ Rs 70
    it has come down to Rs 36

    On Saturday, May 15, 2010 ou recomended the following scrip.
    - VELJAN DENISON Ltd @ RS 375
    it has moved up to Rs 475.

    Do you still recommend buying these gems.??

    Which one do you suggest to accumulate at this stage.

    I hold both want to add few more for long term invetsment purpose.

    Thanks in advance.
    awaiting your reply sir.

    ReplyDelete
  10. hi,

    your one of the old reco..advanta ..can we take fresh position now...its up 20% yesterday....

    ReplyDelete
  11. Dear Prashetty

    I am not a technical analyst to recommend a buy only when a scrip moves up ,I am more comfortable at lower valuation on any scrip

    ReplyDelete
  12. Look into Sika only if you have a very long term view , its recent financial performance is not upto the expectation even if it is in a promising space

    ReplyDelete

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