Saturday, February 16, 2013
We have already discussed another stock from this same sector – Sukhjit Starch-around Rs.169 ( Old posting HERE) which reached a high of Rs.275 and currently trading around Rs.215.As in the case of Sukhjit ,ANIL LTD is a large listed player in starch and starch derivatives industry. This company belongs to Ahmedabad based ANIL group having diverse interest in Biotechnology,Food Processing ..etc.Company manufacturing Native Starch, Chemical Starch, Modified Starches, Dextrins, Dextrose Monohydrate, Liquid Glucose, Corn Syrup, and Sorbitol ..etc. These products are mainly used in Textile,Pharmaceutical, Paper and Food & Beverages industries. ANIL exporting many of its value added products to various overseas markets.Recently company established an SPV to set up a mega food park in Vadodara ,Gujarat.Growth of user industries and price flactuation of raw material is points to note.For the past few months raw material price was high due to lower mansoon in last season.But company could report satisfactory performance with higher top line even its margin impacted due to this factor.Company reported a turnover of Rs.226 Cr v/s Rs.158 cr in December quarter alone .Net profit was flat around Rs.13-14 Cr .For the last financial year company reported a turnover of Rs.645 Cr ,net profit of Rs.50 Cr and an EPS of Rs.52 /- .At current market price of Rs.199 , Anil is trading at a P/E multiple of just 4 which is at the lower end for a dominent player in this industry.A better mansoon in India for the next season or an improved out look of corn production in international market will help the company to reduce its raw material cost.At current market price I feel there is value in it.Recommending an entry for long term investors @ CMP RS.199 and any dip due to over all sell off in mid caps (if any) may take as a chance to add more .
Link to Company website HERE