- Company has reduced debt.
Company has delivered good profit growth of 18.7% CAGR over last 5 years
Debtor days have improved from 40.5 to 28.6 days.
Company’s median sales growth is 19.0% of last 10 years
Company’s working capital requirements have reduced from 57.5 days to 35.0 days - PE and PB very low. Very lucrative price and consistently making profit.
- Its chemical industry and very fluctuating profits due to demand and supply concerns. But it is giving profit consistently every year.
- Margin Volatility: The company’s operating margin remains volatile due to the supply issues of hydrofluosilicic acid. It procures it from distant sources, resulting in higher costs that periodically increase due to rising fuel prices.
- Client Concentration: In FY24, revenue from the top customer made up about 53% of total revenue, up from 39% in FY22. The second top customer contributed 23% in FY24, down from 38% in FY22.
- Geographical Split:
Odisha: 61% in FY24 vs 58% in FY22
Chhattisgarh: 23% in FY24 vs 13% in FY22
Madhya Pradesh: 12% in FY24 vs ~14% in FY22
Others: 4% in FY24 vs 15% in FY22 - Raw Material Arrangement
The top raw materials consumed by the company are Alumina Hydrate (~57%), and Hydrofluosilicic Acid (23%). - Its quarterly result of Jun 2024 was not good. Looking at the past trend, it seems Q1 of FY are cyclically down. Does it mean its good price to enter this stock before its Q2 result. Please provide your thoughts about this stock. Not an expert of the chemicals this Company deals with and this stock is falling so much.
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