Ruchi Soya Industries Ltd | CMP 26 | Turnaround ?

Discussion in 'Ask A Query About Your Stock Picks And Portfolio' started by Guru Vachaal, May 4, 2017.

?

Will you buy this stock ?

Poll closed Aug 2, 2017.
  1. Yes

    1 vote(s)
    20.0%
  2. No

    2 vote(s)
    40.0%
  3. Not sure

    2 vote(s)
    40.0%
  1. Guru Vachaal

    Guru Vachaal Let's discuss the fundamentals..

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    Featuring among the top five FMCG players in India, Ruchi Soya Industries Limited (Ruchi Soya) is a leading manufacturer and India’s largest marketer of healthier edible oils, soya food, premium table spread, vanaspati and bakery fats. It is also the highest exporter of soya meal, lecithin and other food ingredients from India. Established in 1986, Ruchi Soya has emerged as an integrated player, from farm to fork with secured access to oil palm plantations in India and other key regions of the world. Ruchi soya has access with exclusive oil procurement rights to over two lakh hectares of land in India with a potential of oil palm cultivation.

    The Company has focused on continuous expansion across business verticals to consolidate and sustain its industry leadership. Over the years the Ruchi group has metamorphosed from a trader to a manufacturer & marketer and Ruchi Soya is now a company with a strong portfolio of brands viz. Nutrela, Mahakosh, Sunrich, Ruchi Gold & Ruchi No.1. With a turnover of over US$ 5 Billion, Ruchi Soya Industries Limited is listed on Bombay Stock Exchange Limited (BSE Code: 500368) and National Stock Exchange of India Limited (NSE Code: RUCHISOYA). Social initiatives of Ruchi Soya with a focus on healthcare, education and women’s empowerment, help in creating sustainable value for society as well as the organisation. Ruchi Soya is committed to renewable energy and exploring suitable opportunities in the sector.

    Brands:-
    Nutrela, Mahakosh, Sunrich and Ruchi Gold are the trusted brands of Ruchi Soya. Nutrela is the most respected soya foods brand in the country and has become generic to that category. Nutrela also has instant soya, ready to cook soya mixes, refined oils and table spread under its brand offerings. Mahakosh Refined edible oils offered under Soyabean, Sunflower, Mustard, Rice bran, Groundnut, Cotton Seed flavours and Vanaspati are known for its purity and premium taste. Sunrich is a healthier, lighter and clearer super refined sunflower oil brand in India. Ruchi No 1 is a leading edible oil and Vanaspati brand. Ruchi Gold and Ruchi Star are mass edible oil brands with Ruchi Gold being the leader in Palmolein and India’s largest single oil consumer brand.

    Issues:-
    In July 2016, IDFC Bank filed a winding-up petition against Ruchi Soya after it failed to repay its shortterm credit. And in February this year the company was served an insolvency and bankruptcy notice by an unsecured lender, seeking repayment of Rs 9.63 crore.

    Amid the financial turmoil, managing director Dinesh Shahra displays Zen-like calmness. Ensconced in his red recliner in the Ruchi Soya corporate office in the Mumbai suburb of Goregaon, the 65-year-old, first-generation entrepreneur sounds confident of staging a comeback. “We are getting back on track,” he says, pointing to a recent tie-up with Baba Ramdev promoted Patanjali Ayurveda to refine and package soya, mustard and sunflower oil for the Haridwar based consumer packaged goods company. We want to pay back everybody. We will soon be profitable,” he says, adding that the worst is set to get over.

    Market Cap 887 cr
    Sales 30283 cr
    Debt 5540 cr
    Reserves 1161 cr
    Promoter Holding 57%
    Promoter Pledge 51%
    Cash 264 cr
    Book Value 37
    CMP 27

    Although many important aspects in the books don't appear in good shape but still turnaround may be the next big thing here.

    Note:- Take the investment decision at your own risk. Consult a SEBI certified expert before investing.
     
    Last edited: May 4, 2017
    shakti khanduri likes this.
  2. shakti khanduri

    shakti khanduri Active Member

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    I like this kind of situation.
     
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  3. Manmohan Gupta

    Manmohan Gupta Member

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    Will add on dips.
    Thanks for this wonderful investment idea.
     
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  4. shakti khanduri

    shakti khanduri Active Member

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  5. shakti khanduri

    shakti khanduri Active Member

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    But to take advantage GUTS ,PATIENCE, LONG TERM PERSPECTIVE . and CONVICTION in strategy is must.MULTIBAGGER RETURNS IS ASSURED. As you must be knowing ,this is also called VULTURE INVESTING.
     
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  6. Warren Buffet Jr.

    Warren Buffet Jr. Member

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    Hey! that's a good analysis on Ruchi Soya, I'm a lot skeptical about this stock as the the numbers are really not good,
    • Negative EPS & PAT for FY16, if there is upside on technical side then it might be but on fundamental side the numbers are really poor.

    I would swap it for Ajanta Soya, for the following reasons -
    • Negligible Long term debt
    • 5 year CAGR PAT = a whooping 75% (profit rose from 0.31Cr in FY12 to 5.09 Cr in FY16)
    • 5 year CAGR EPS = 66%
    • 5 year CAGR Revenue =9.5%
    • Promoter Holding = 48.52%
    This just my analysis, I'm open for your views! :)

    CMP - 76.3

    Dis. - My views are personal please do a due diligence before investing.

     
    Last edited: May 7, 2017
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  7. saashy

    saashy Member

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    Good points, thanks. I also happen to hold Ajanta Soya and it has shown some good traction in the last few weeks; barring yesterday when it did fall close to 7%. Ruchi when breaks out, may see a quick upside. Deserves a close watch.
     
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  8. Guru Vachaal

    Guru Vachaal Let's discuss the fundamentals..

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    Hello sir,

    Please note that good numbers are no guarantee of making money and bad numbers are no surety of stock failure.

    Ruchi soya seems to be a turnaround story where things will improve.
     
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  9. shakti khanduri

    shakti khanduri Active Member

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    Get to kknow your temperament ,select your strategy.
     
    Last edited: May 7, 2017
  10. sanjib

    sanjib New Member

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    Please check sanwaria agro oil. Turn around business. From soya to fmcg story. Big change in business matrix. Premium rice is included. Important trigger : june17 result will be declared by 7th july and bonus shares. Can give decent profit.
     
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  11. w4wealth

    w4wealth Well-Known Member

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    i also thinking so. also massive deleveraging play.
     
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  12. rushia

    rushia Member

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    Market participants I spoke to appear to have a poor opinion about the promoters of Sanwaria. Any thoughts?
     
  13. Manmohan Gupta

    Manmohan Gupta Member

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    Ruchi Soya on fire today.
    Wonder what news has come in the stock.
     
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  14. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

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    Looks like GST benefit is there for stock.
     
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  15. Guru Vachaal

    Guru Vachaal Let's discuss the fundamentals..

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    Could be a technical bounce.
     
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  16. gareebnawab

    gareebnawab New Member

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    I regret doing the same mistake for not buying Caplinpoint and Ajanta Pharm by hearing bad talk in the market about Promoters (management). They became multibagger and companies don't turnaround in days or months. They take time. Sawaria agro Management they have been reducing debt and also they issued preferential shares to promoters with value of 25/- (link) post bonus issue which means at a value of 12.5 and Promoters have increased they stake in the company.

    I know they have lot of governance issue not (submitting or) delay in submitting docs to BSE. I'm not saying the company is in buy list / to buy . Never go with the market noise saying promoters are not it will cost you a lot. GST has come which will be plus point to organized sector.

    Go with the fundamentals looks for improving thing. When company comes to good shape like will zero debt and good cash flow, you will not find for cheap valuation.

    My risk taking capability is high and I hold sanwaria agro stock in 4% my portfolio.

    ----
    I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations”
     
    Last edited: Oct 6, 2017
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  17. good stocks

    good stocks Active Member

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  18. Manmohan Gupta

    Manmohan Gupta Member

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    Can we average here for long term?
     
  19. Guru Vachaal

    Guru Vachaal Let's discuss the fundamentals..

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    BANG BANG even in COVID environment.

    Noticed at 26
    CMP 340
     
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  20. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

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    Sooper. Excellent stock picks :) How are other stocks in portfolio doing now.

    I had huge loss in DHFL and lost big money :(
     
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