Planning Rs 300 crore capex for next 2 years: Kwality

n an interview to CNBC-TV18, its CFO Sunit Shangle discusses their expansion strategy and the compnay’s future plans.

Products like flavoured milk have a huge market. Flavoured milk is capped at around Rs 1,000 crore this time growing at the rate of almost 30 percent so there is a scope for everybody to sell these products in the markets. Even overall if you see the market, it is claimed to be between three lakh crore, milk market is there so I don’t think competition would play a very important role. Everybody will be able to sell what they are producing.

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Look at Kwality: Prakash Diwan

If you look at the financials, they are very impressive, they might see very average but if you see the kind of earnings that they have already clocked last year, it was about more than 7, full year EPS. We expect that this year it could probably be in the range of around 8 and FY16 could be around 10, so from that perspective, the stock is under 4 P/E whereas Prabhat Dairy if you see the draft red herring prospectus (DRHP), they are expecting much more of a premium. So this industry deserves much better premiums and I think Kwality is available at a mouth-wateringly lower P/E multiple

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