Saturday, May 9, 2015

ESSEL PROPACK LTD - AN INDIAN MNC




 
Even if we consider the entire world , India is one country with maximum number of listed companies in any stock exchanges. This gives us an opportunity to select from a large pool . But if our selection criteria is specific  to find out a company with sizable global market share in any product , it may be bit difficult. Only very few Indian  listed  companies succeeded to grow beyond boundaries and eligible to be called as true Indian Multinationals , especially in manufacturing sector. This week let us look into one such company -Essel Propack .


                                                                   Essel propack is the  global leader in  laminated  tubes    with  close to 35%  percent  global market  share.( Laminated tubes are familiar  for us as the packing material of Tooth Paste) . Company operating about 25 factories located in more than 10 countries. Essel serving both Oral care and non-oral care segment and it is an undisputed leader in oral care segment with more than 50 % market share in large countries like India and China. In the non oral care segment , company’s products are used to pack food items, Pharmaceuticals, Cosmetics ..etc. Company generating about 40 % of income from India , 20% from China and remaining from other countries.At present , majority of income is coming from oral care segment and now company is taking efforts to increase its market share in non oral care segment where growth is high and margin is better. It is aiming to reach a 50:50 ratio in another few years.



Innovation and customization backed by strong R&D is the backbone of the success of Essel Propack. Company developed many first of its kind products and always keen to develop products as per the specifications given by its customers.High lustre metallic look lami-tubes ( EGNITE) ,Recyclable tubes with Oxygen barrier ( GREEN MAPLE LEAF) ..etc are some of company’s unique innovations.

                                                                                  As we are aware,  many western countries are still fighting to come out of recession . As a global player, Essel’s performance is subject to the improvement of economies of these countries too. Even in a not so good condition for economies of  some of its major markets including European countries, company could perform well .Few of company’s subsidiaries are still operating in loss or at break even level . I hope, with improvement in western economies , more and more subsidiaries of company will improve their performance going forward. Since company’s raw materials are crude derivatives , price of crude is one point to note .Any significant increase in crude price may impact its margins if company not in a position to pass on the same to its customers.There was a family arrangement  between the promoters  of company during December 2014 and as per this Essel propack is vested with Ashok Goel .  Subhash Chandra , his immediate family members and the entities controlled by him and his immediate family members have ceased to be part of the promoter group of Essel Propack  as part of this  modified family arrangement.I believe, clarity on the ownership will help and encourage the management to take the company to next level of growth through a focused approach .In an effort to strengthen its balance sheet , company now taking efforts to reduce its debt . In FY 2013-14 Essel reduced its debt by Rs.60 Cr.

                                                                             For the financial year ended March 2015 , company reported a topline of Rs.2323 Cr ( Previous year  Rs.2126 Cr) and a net profit of Rs.141 Cr ( Rs.108 Cr) . EPS for the year is Rs.9 . Essel propack is a proxy play to ride on global consumer growth and a stock suitable to include in core portfolio for steady compounding in the years to come . EPL listed in both stock exchanges and currently trading around Rs.127





Link to Company Website HERE 

Discl: It is safe to assume that I have vested interest in EPL




92 comments :

  1. Very good pick sir . your view upon Philips carbon and elicon eng. And how was result of Philips thanks

    ReplyDelete
  2. Sir ur view on mmtc.pricol. rolta India. Selan exploration

    ReplyDelete
    Replies
    1. SElan is an already suggested stock , not tracking others

      Delete
  3. Sir ur views after correction in
    Info edge
    Jk bank
    Snowman logistics

    ReplyDelete
    Replies
    1. Positive on the business of Infoo Edge and Snowman

      Not tracking JK Bank

      Delete
  4. Is Hindustan tin works,billcare worth buying at this stage. Thanks in advance

    ReplyDelete
    Replies
    1. Opinion on Bilcare after the accounting related issue already shared with you more than once .

      Review Hind Tin result before a fresh entry

      Delete
  5. Thank you VP! We wait for the second Saturday for your new suggestion.

    It gives further confidence to know that the " Dubious businessman Subhash Chandra" is no more associated with this company.

    If my comment is of no sense, please do reply, for me to correct.

    Thanks again for the new tip!

    Parthasarathi

    ReplyDelete
    Replies
    1. Whether he is ' Dubious' or not , clarity on management control is positive.

      Delete
  6. Hi Sir what's ur view on mirc electronic considering they r involved in production of onida TV .they have huge debt but still since its a consumption story and also ur overall view on UFO moviez IPO...thanks

    ReplyDelete
    Replies
    1. Not tracking MIRC Electronics

      Not a bad company or business but pricing of IPO is aggressive

      Delete
  7. Thanks vp for the valuable advice. ..eagerly wait every week for ur recommendations

    ReplyDelete
  8. Sir ur thought's on genus power infra and infinite computer .

    ReplyDelete
  9. Sir I am a long term portfolio holding having 30 stocks.
    In general how many stocks should a long term portfolio contain .

    ReplyDelete
    Replies
    1. It depends on lot of factors like your conviction in a company , risk taking capacity, time to follow companies and busniess..etc . 30 seems too much

      Delete
  10. Dear VP Sir, kindly give your view on Indosolar.

    ReplyDelete
  11. Sir good morning. I am your silent follower since 1 and 1/2 year. I must read all of your conversation And I get ans many of my query automatically but sir this time I am confuse for ashapura intimates I find your positive comment on this ..I am confirm about the growth story and promoter quality but your acceptance is must for me .I think you are not disappoint me. you can answer in my mai id sweethomes 717@Gmail. Com ......Thanks for your kindness. ..

    ReplyDelete
    Replies
    1. Those with some risk appetite may consider taking limited exposure.

      Delete
    2. VP Sir,
      As the stock is a traded in bse SME platform I think most of the retail invedtor cannot take limited exposure..):

      Delete
  12. Thanks for one of its kind of stock.

    Any suggestion on "Nitin Fire Protection Industries" after they expand their business in Defense sector.

    waiting for your valuables suggestion.

    Thanks

    ReplyDelete
  13. Dear Sir, What is your take on Shaily Engineering Plastics?
    Please let us know.

    Thanks,
    Satpal

    ReplyDelete
    Replies
    1. Good business and good clients list . If promoters are able to scale up business , potential is there

      Discl: I have vested interest in it.

      Delete
  14. What is your current view on your GTS-8 stock, Salzer Electronics?

    ReplyDelete
  15. Thanx for the good pick sir.

    I would like to know your view on Simran Farms, one of ur old reccomendation. Is it still a good buy for long term?

    ReplyDelete
  16. Sir I would love to develop a business sense like you have. I want to understand which businesses are good and will last and which wont. Will you please recommend some books which will help me in understanding businesses - pharma, auto , IT, FMCG,etc

    ReplyDelete
    Replies
    1. Potential is business is a changing one depends on lot of factors like change in technology, life style..etc. I don't think anybook can help to spot opportunities beyond certain level.

      Delete
  17. Sir your views on SACHETA METALS. It is a previously recommended stock by you ?

    ReplyDelete
  18. Your view on Blue star info n Orbit exports at current for investment?

    ReplyDelete
  19. Sir what is your view on FCEL and wipro?

    ReplyDelete
  20. Another great pick sir.. :) kindly share your views on defense and renewable energy space sir..

    ReplyDelete
    Replies
    1. Sectors are not bad , whether listed companies can gain anything depends on lot of factors like tax struture ..etc especially in the case of renewable energy sector.

      Delete
  21. Sir,

    what is your view on Samkrg pistons? Should I hold for long term?

    ReplyDelete
    Replies
    1. No change in my opinion about the company . Whether you should hold or not is purely your own decision :)

      Delete
  22. Sir,

    Please share you view on IVRCL Limited.

    Thanks
    Thiyagarajan

    ReplyDelete
  23. Hi Sir...what are ypur views on STAMPEDE CAPITAL?

    ReplyDelete
    Replies
    1. Not tracking due to dubious promoter history

      Delete
  24. Happy b''day value-pickjiii....::)

    ReplyDelete
  25. Pls share ur views on rcom.steel strip wheels.
    Rolta india.

    ReplyDelete
  26. Sir, ur view on avanti feeds after q4 numbers???

    ReplyDelete
    Replies
    1. Suggested to book profit , as of now not tracking

      Delete
  27. dear vp sir..
    How are you sir..? view on rathi bars ltd stock...?
    thank you sir..

    ReplyDelete
  28. what is your view on umang diary and lgb forge

    ReplyDelete
    Replies
    1. Umang is a decent one, not tracking LGB Forge

      Delete
  29. Hi VP Sir, Based on recent past history, It looks like you are adding and recommending mid caps but not micro cap companies which you added and recommended couple of years back. I am not saying this is right or wrong. Just wanted to share my observation.

    I know that Mcap is not any yard stick for investment decision. Because I hold Large/Mid/Small/Micro companies in my portfolio.

    Thanks
    Venkata

    ReplyDelete
    Replies
    1. Suggestions are depends on valuation and earnings

      Delete
  30. Sir your views on sintex results and overall view considering swachh bharat where sintex could be major beneficiary

    ReplyDelete
    Replies
    1. Not bad , may move up in future too but stock gained substantially in last one year and hence don't expect same speed

      Delete
  31. Replies
    1. Hold , if you are a long term passive investor

      Delete
  32. Sir, just read the news on your mmb ID hacked in Facebook. Why the news not pasted in this blog sir?

    ReplyDelete
  33. Dear VP sir,
    I have been following the below recommendations of yours and i see that many of them are now available at a much cheaper cost...some of these have fallen from your recommended levels too which i think is an overall impact of market sentiments and nothing related to their stories as such.... i would like to know whether these could be fresh buy candidates at these levels and one can accumulate these at current levels -

    Patel Airtemp - 130
    Hindustan Tin - 59
    South Indian PaperMill - 65
    SAMKRG Piston - 152
    Polyplex - 202
    Mangalam Cement - 237
    Krebs Bio - 106
    Kopran - 47
    IL&FS - 84
    Amines & Plasticizers - 30
    Aimco Pesticides - 50

    Do let us know which you feel are for consideration at this point.

    Thanks,
    Ramesh

    ReplyDelete
  34. Trying to recover it and hope the same is possible if the MMB people co-operate

    ReplyDelete
  35. Sir your views on Mac Charles (india) Ltd. And phoenix lamps Ltd.
    Thank you.

    ReplyDelete
  36. Sir, Mold Tec Pkg and Patels Airtemp can be added more at CMP ?

    ReplyDelete
    Replies
    1. Both are good companies with bright prospects

      Delete
  37. Dear sir, your view on jp power please.

    ReplyDelete
  38. VP sir,

    Your views on Salzer Electronics results please. Thanks you sir.

    ReplyDelete
    Replies
    1. Thanks for all your insights. Quick question: Did Salzer results beat or exceeded your expectations?

      Delete
  39. sir, your views on laksmi vilas bank and dhanalaxmi bank ?? thanks u.

    ReplyDelete
  40. Your valuable opinion on Capital first after results please. Can we hold this for long term. I have entered into this at @228 after your recommendation. THANK YOU :)

    ReplyDelete
  41. Every time I comment or ask here nothing is published

    Atleast I expect this time to see my comment answered

    What is your view on KSE Ltd which has declared two dividends in FY 14-15 and again one more dividend likely to be declared

    Trading at attractive valuations

    Consistency in performance

    ReplyDelete
    Replies
    1. Please understand , practically it is difficult to answer for each reader for same stocks which answered for someone else in recent past . Many times I replied that I am not tracking KSE

      Delete
  42. Hi VP Sir,

    Your view on Nitesh Estate after the MOU with Goldman Sachs and Acquisition of 1 million sq. Feet Shopping Mall in Koregaon Park - Pune.

    Will you consider the stock for your study to analysis it further.

    ReplyDelete
  43. Hindustan Media Ventures declared a very good result today with the announcement of dividend. As per the Results Presentation published today, during the financial year they posted a Basic EPS of 19.19. The stock thus trades at 12.3 P/E. 40%+ q-o-q increase in net profit.
    When compared with jagran prakashan don't you think this will be valued higher.

    ReplyDelete
    Replies
    1. Business is steadily growing , expecting same trend in stock price .

      Delete
  44. Sir, Please give your views on Jubilant Industries after the sale of Total, the retail arm of the company.

    ReplyDelete
  45. SBG recently awarded Mystas Infra Saudi Arabia (MISA), a subsidiary of Indian company IL&FS Engineering and Construction Company Limited, a contract worth $77m to supply, deliver, install, supervise, and hand over structural and reinforcement concrete works for two 230m-tall towers (2A and 3A) of the project.

    http://www.constructionweekonline.com/article-33664-revealed-worlds-biggest-hotel-to-open-in-ksa/

    ReplyDelete
  46. Has the market corrected enough ,or still correction is there.

    ReplyDelete
  47. Dear VP sir,
    You didn't answer my below query. Could you please add your comments -

    Dear VP sir,
    I have been following the below recommendations of yours and i see that many of them are now available at a much cheaper cost...some of these have fallen from your recommended levels too which i think is an overall impact of market sentiments and nothing related to their stories as such.... i would like to know whether these could be fresh buy candidates at these levels and one can accumulate these at current levels -

    Patel Airtemp - 130
    Hindustan Tin - 59
    South Indian PaperMill - 65
    SAMKRG Piston - 152
    Polyplex - 202
    Mangalam Cement - 237
    Krebs Bio - 106
    Kopran - 47
    IL&FS - 84
    Amines & Plasticizers - 30
    Aimco Pesticides - 50

    Do let us know which you feel are for consideration at this point.

    Thanks,
    Ramesh

    ReplyDelete
  48. sir, your views on laksmi vilas bank and dhanalaxmi bank ?? thanks u.

    ReplyDelete
  49. Sir, global economy is bleeding and raw materials prices are at multi year lows which may increase in coming times. Don't you see problem in achieving expected growth in next 2 years ??

    ReplyDelete
  50. Sir
    your view on SRS for long term

    BSE: 533569
    NSE: SRSLTD

    ReplyDelete

Followers

Tweet TopOfBlogs