PEARL POLYMERS LTD – 24 (BSE:523260 NSE:PEARLPOLY) –The makers of PEARLPET Jars,Bottles & Containers

Company : Pearl Polymers Limited, Established in 1971, the makers of PEARLPET brand kitchenware since 1984, are the pioneers in bringing ISBM (Injection Stretch Blow Molding) technology to India. PPL is one of the most distinguished and reputed manufacturer and exporter of all types of PET containers and bottles in India.

The brand PERALPET is the most trusted household name in kitchen storage solution being the pioneer to offer Pet Jars and Bottles to the Indian market, which replaced heavy and difficult to maintain Glass products from the Indian homes in the early 1980s, due to the various qualities like : Non-toxic, Food-grade and Re-usable, Unbreakable, Strong and Light-weight. PearlPET uses virgin PET, PP or LDPE materials which are universally approved by USFDA, EU Directive 2002/72/EC, BIS IS:12252 -1987 and other regulating bodies for Food, Beverage and Water storage, products & raw material do not use Bisphenol A (BPA) or other harmful plasticizers/chemicals, steel cap jars have strong durable stainless steel cap, rust free & unbreakable, Air tight, 100% recyclable and are environment friendly.
Today PEARLPET branded products includes hundreds of items of various colors, size and utility, like : Water Bottles, Food Storage and Micro Fresh in different variants and price range.

Through the network of four plants (Baddi, Pant Nagar, Mahad & Jigani) and numerous offices through the length and breadth of the country, and a production capacity of over 100 machines currently, Pearl Polymers have successfully changed the packaging industry in the country. The company also sells its products online through every major e-commerce site, thereby directly serving the consumer which not only saves money, but in the process also gets direct feedback from the consumers instantly, which help the company to improve and innovate further.

The company has robust R&D Department, the success of which has been realized through several packaging awards, like the World Stars, Asia Stars, India Stars and Plast Icons Awards that have been awarded to Pearl Polymers Limited, both nationally and internationally. In addition to the PearlPET brand, Pearl is also the largest custom-molded rigid packaging supplier in India doing job work for various FMCG brands in Food and Beverage segment.


The company is continuously automotive the process to cut the cost by investing in Online Carton Printing machines, Collating machines, Automated shrink tunnels, Labeling Machine & Conveyors, etc. The company is also working on using 'Tritan' material (A specialty grade Polyester) for making high end products for Indian market. The concept of bottles, jars & containers is very new in Indian market & has immense potential for growth. The company will soon be launching Fresh & Seal range of new products under its MicroFresh line of microwave friendly products.

Valuation : This 45 year old company with 54% Promoter holding, having strong brand value among household and retail segment, which also happen to be the pioneer into bringing safe to use plastic products in Indian kitchen and having production facility at 4 different locations and production line of over 100 machines, is available at a market cap of only 40 Crore (Brand valuation alone should command more than 75 Cr) and 30% discount to Book Value of Rs 31.5 per Share, and having FY 16 Sale of Rs 176 Cr thus giving Mcap to Sales of less than 0.25 times. The promoters are working on to turn the company around in few quarters, which can be seen in their efforts of cost cutting, reducing debts and selling online through e-commerce. With the price of crude stabilizing near 50$ the company will have a stable pricing for raw material.

The company should begin to report good numbers going forward and command good PE ratio. Investors should study this HIDDEN GEM for long term growth. (The company is also listed in NSE so the quarterly and yearly price band does not apply.)

 

Good research report.

 

IMHO volume of stock is not there. M cap is Rs. 40 cr and 30 day average stock volume is only 20000 share worth Rs. 4 lakh only this means that no liquidity is there in stocks and even small purchase and sale will send stock to uc or lc.

Have you any other stock in radar with min m-cap of Rs. 150 to 200 cr and with good liquidity such as Prima Plastic or Neelkamal?

 

looks interesting. good find.