Two key risks i can think are Crude Oil price and asset heavy business model. I see profit is increasing along with debt.
However their ROE and ROA showing improvement in the last 2 years. It used to be low margin business(approx 3% Profit). However i believe, going forward their margin would increase against the backdrop of low crude oil price and purchasing their product by the leading e-commerce retailers for packaging.
Disclosure: Invested at Rs 9 and Sold at Rs 12 in 2012-2013 after realizing it was low margin business. Bought again at Rs 24 and holding as i realized it’s fortunes are changing for the reasons mentioned.
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