Camlin Fine Chemicals and Cigniti Tech

Views invited on investments into these two stocks!!!

 

Camlin is good , Face value : Rs. 1
high debt company , Contingent Liabilities are also high Rs. 125 Cr. , Total Debt Rs. 135 Cr.
recent year promoter sold some small stake nearly nearly 0.35 %shares
CMP :Rs. 103.85
after crossing Rs. 110 it may go to Rs.120 / 130 levels

cigniti last year foreign promoter sold some stake
cign is a costly share not available at fair value ...
Current EPS is only 1.45

Please avoid this stock , It is a high risk stock

 

Thanks rama

 

Whats the contingent liability on account of?

 

Camlin fine sciences has fixed assets of around 106 crores and they announced about the new integrated plant in dahej , going to commission on FY 17 which s at the cost of 191 crores ... Nearly double than existing asset base
.. When we look their past five year financials, we can notice that opm s increasing consistently every year ... It may be due to their vertical integration as per the company statement ... Need to study more on product profile and their demand , competitors , customers etc...

 

Blockbuster q2 from cigniti

- yoy sales up 81% and pbt up 3.7 times

 

Sachin - I just saw this thread. Camlin has good financials. Plus they have global dominance and an excellent business model based on backward integration. I will just restrict myself to the headline numbers :

- ROE has been going up steadily and is now 26%. The Dupont analysis shows there is enhancement of all three levers, viz - Net Margin, Asset Turnover and Equity Multiplier.
- 5 year revenues CAGR is 26 %
- 5 year Operating Margin CAGR is 31 % with a margin of 13%
- 5 year ROCE CAGR is 12 % and stands at 23 %
- 5 year Operating Cash Flow has a CAGR of 44 %
- 5 year Adj EPS ( adjusted for split ) is 31 %
- If you apply this adj EPS and work out PEG it is at an incredibly low .15. ( This needs more clarity, coz I need to be sure of the adjustments)

Hard to find fault with this stock

 

Superb analysis. Also very good promoter in Dandekar. Clean and honest family.

 

After adjusting eps for split and equity dilution, peg comes to .40 not .18 but hey! .4 peg for this kind of growth share is pure gold.

 

But given its (CAMLIN FINE SCIENCE) present MRP, ,do you recommend buy at the present level of this commodty type investment,keeping in view MOS ? You must be knowing better. No disrespect meant .

 

Camlin stock EPS is 2.69,so PE is 41.So how PEG can be 0.4..Is it growing at 100% CAGR.?

 

PE 41 standalone basis???

 

Yes, but you need to adjust for the fact that there have been stock splits. It was a 10 rupee share which became a 2 rupee share and then a 1 rupee share. Given that equity capital has not increased despite no of shares going up( except marginally in 2014) adjustments need to be made for calculations. My calculations are based on that. Will upload my camlin excel later today

 

Have uploaded it as a PDF document. This is also helping me to clarify my thinking, so please do help me learn by being constructively critical of this document. thanks. Please note that there is a typo in the documents. Instead of saying EPS 2015 and 14 should be multiplied by 5 ( for valuation purposes only), I have said it should be multiplied by 2.

 

Sir,
Very much interesting. Learnt an important lesson that one should not blindly look at the ratios. Newbies like me can learn a lot from this thread. Many thanks to you for kickstarting this debate. Looking forward to read the views of other senior Members.
S.Karthikeyan

 

Very good analysis

 

2.69 s standalone eps I think ...

 

Convincing critical reasoning analysis indeed ! CONGRATULATION.....But I am still not clear my mind.

 

I think it is a good share to look at for the long term. Apart from financials, there is the fact that they are not in a commodities business in the general sense. They make the stuff which is used in food preservatives. One of few companies in the world with this level of dominance and backward integration. Industry is good, company is good, price is good. For me that is a buy. Can you find a better price? Always possible. Key is to enter a well managed business with strong financials having a growth mindset. Then minor price variations won't give us heart attacks.

 

All of u plz post ur watsapp no...ill create watsapp group and we can share r experience ....market news etc in watsapp