Just yesterday National Peroxide declared their result. Their half yearly results were already excellent. Now their EPS for 9 months stands at 73.31 compared to 17.90 last year’s 9 months. For entire last year their EPS was 28.19. Last year they paid dividend of Rs 10.00 and book value at FY10 stands at 136.10. It has very low capital (Rs 5.75 Cr) and Debt Equity Ratio is at 0.10. For detail results see http://www.bseindia.com/xml-data/corpfiling/announcement/National_Peroxide_Ltd_080211_Rst.pdf .
Company has said that this quarter have additional income of Rs 1.34 Cr from subsidiary companies, however PBDIT has expanded 4 times in 3QFY11. This is on the back of higher prices of Hydrogen Peroxide. Similarly company has announced the plan to expand the capacity expansion plans.
What to Expect
From these numbers one can expect that their final year EPS should stand at somewhere at Rs 100. It will take their book value beyond 236 which is half of today’s market price. Expect a liberal bonus or hefty dividend (last year Rs 10) in near term. Since its expanding the capacity and higher Hydrogen Peroxide prices will continue to increase, the company will possibly increasing the profits.
As of yesterday it closed at Rs 502 .
Some additional info ...
Some additional info ...
Its capacity is increased to 65 KTPA and plan is to increase to 84. It has 26% share from foreign partner. It is the largest H2O2 producer in the country with 38% market share. Major use of H2O2 is for environmental applications and is considered as Mr. CLEAN. In the long term the need of H2O2 will continue to grow. It doesn’t have any loans in their books. It uses natural gas as raw material. Till last year they had to purchase on spot prices, but now they have long term agreement with GAIL and hence price fluctuation will be limited. The down side is raw material price depends on crude oil and exchange rate, so is with many other companies. Another downside can be, that there is larger capacities of H2O2 coming up in ASEAN countries.
This is my view on this stock. You should review the performance of any stock before buying
2 comments:
Net profit of National Peroxide rose 257.04% to Rs 57.84 crore in the year ended March 2011 as against Rs 16.20 crore during the previous year ended March 2010. Sales rose 48.99% to Rs 181.63 crore in the year ended March 2011 as against Rs 121.91 crore during the previous year ended March 2010.
For the entire year in FY1011, it posed profit of Rs 56 Cr compared to Rs 16 Cr a year before ( that is 250% increase ) !!! It also recommended Rs 12/- as dividend. Today's PE Ratio stands to be at merely 5.5 with huge book value of Rs 223.
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