Radhakishan Damani goes on shopping spree
Radhakishan Damani is obviously an old-school investor and a staunch believer in the adage that one must aggressively grab stocks when they are in the doldrums.
He has been making frequent forays into Dalal Street and can be seen tucking into the choicest of stocks at bargain-basement prices.
A few weeks ago, I diligently reported that he had bought massive truckloads of Embassy Office Parks REIT, Metropolis Healthcare and Foods & Inns.
He also bought a big chunk of Delta Corp, which is the favourite of his protégé Rakesh Jhunjhunwala and of Kalpraj Dharamshi, the veteran investor.
It is also a matter of record that he has been aggressively adding VST Industries, one of his all-time favourite stocks, into his portfolio.
The stock has surged from a paltry Rs. 88 to the CMP of Rs. 4200, showering massive multibagger gains upon the legendary investor.
In addition, the Billionaire reaps a generous dividend yield of nearly 3% from the stock, which adds to its luster.
VST Industries
RADHAKISHAN DAMANI Buys 270,000 @ 4,260
HDFC MUTUAL FUND Sells 273,706 @ 4,260.00When RKD first started accumulating this in 2001, stock price was 88. Kept accumulating till 125-150 until the bitter battle with BAT happened.
As of Sep he owns 26% in Co.
— Mangalam Maloo (@blitzkreigm) November 13, 2019
(Radhakishan Damani with Rakesh Jhunjhunwala and other distinguished luminaries)
Camlin Fine Sciences, latest stock pick of Bright Star Investments
Now, the latest sensational news is that Radhakishan Damani has taken a fancy for a specialty chemical stock named ‘Camlin Fine Sciences‘.
The wily Billionaire has used his trusted investment arm, Bright Star Investments, to make the acquisition.
He now holds 18.2 lakh shares in the company, comprising of 1.5% of its equity capital.
Camlin Fine Sciences
Radhakishan Damani buys 1.5% stake in company during Q3 periodRadhakishan Damani's Bright Star Investments now holds 18.2 lakh shares in company
Alert: RK Damani is the promoter of D-Mart and a renowned investor
Alert: Stock is up 25% on 1 mth basis
— Yatin Mota (@YatinMota) December 27, 2019
Camlin is a micro-cap with a market capitalisation of only Rs. 925 crore.
It is the world’s second largest manufacturer and marketer of food grade antioxidants TBHQ and BHA.
Its product range includes Food Ingredients like Antox TBHQ, Antox BHA, Sweetener and Active Pharmaceutical Ingredients like Miconazole Nitrrate B.P. / USP, Clotrimazole B.P. / USP, Amlodipine Besilate E.P etc.
| KEY FUNDAMENTALS Of CAMLIN FINE SCIENCES | |||
| PARAMETER | VALUES | ||
| MARKET CAP | (Rs CR) | 926 | |
| EPS – TTM | (Rs) | [*S] | 0.56 |
| P/E RATIO | (X) | [*S] | 136.25 |
| FACE VALUE | (Rs) | 1 | |
| LATEST DIVIDEND | (%) | 45.00 | |
| LATEST DIVIDEND DATE | 28 JUL 2016 | ||
| DIVIDEND YIELD | (%) | 0.00 | |
| BOOK VALUE / SHARE | (Rs) | [*S] | 29.40 |
| P/B RATIO | (Rs) | [*S] | 2.60 |
[*C] Consolidated [*S] Standalone
| FINANCIAL RESULTS | |||
| PARTICULARS (Rs CR) | SEP 2019 | SEP 2018 | % CHG |
| NET SALES | 222.28 | 201.34 | 10.4 |
| OTHER INCOME | 0.64 | 9.88 | -93.52 |
| TOTAL INCOME | 222.92 | 211.22 | 5.54 |
| TOTAL EXPENSES | 192.26 | 184.12 | 4.42 |
| OPERATING PROFIT | 30.66 | 27.1 | 13.14 |
| NET PROFIT | 7.52 | 1.93 | 289.64 |
| EQUITY CAPITAL | 12.13 | 12.13 | – |
(Source: Business Standard)
Camlin Fine Sciences is all set for re-rating and has gain potential of 130%
Surya Patra of Philip Capital is an expert in the affairs of Camlin Fine Sciences.
He has conducted a detailed study and opined that the stock is “all set for re-rating led by improved earnings visibility“.
The conclusion is quite succinct:
“Outlook and valuation:
CFIN’s Q2 operating performance was better than our expectations.
Going ahead, we expect profitable growth for CFIN led by Dahej plant commissioning, ramp-up in blends business, Improvement in utilization China vanillin plant and continued growth momentum in performance chemicals.
We estimate CFIN’s sales/EBITDA to grow rapidly at a CAGR of 24%/62% over FY19-22. CFIN currently trades at deep discounts (i.e. 4x FY21 EV/EBITDA and 6x FY21 PE) due to the weak earnings in the recent past but we expect re-rating led by improved earning visibility.
Reiterate buy with target price of Rs 140 i.e. 8x FY21 EV/EBITDA.”
A similar view has been expressed by Amar Mourya and Rohit Sinha of Emkay.
The duo has confidently asserted that Camlin is “going in right direction” and recommended a buy.
Investors’ Presentation explains game plan
The latest investors’ presentation of Camlin Fine throws light on several important aspects such as the business model, major clients, key strengths, growth strategy, Update on Dahej Project etc.
Is Vidhi Specialty Food Ingredients also a good buy?
According to some knowledgeable punters on Dalal Street, Vidhi Specialty Food Ingredients is an arch rival of Camlin in the foods ingredients marketplace.
Vidhi is also a micro-cap powerhouse with a market capitalisation of only Rs. 320 crore.
Anchal Pathak and Anubhav Sahu of moneycontrol.com have explained the merits of Vidhi Specialty and other food stocks like Dynemic Industries etc in a cogent manner and concluded that these are also good investment opportunities.
Yes its a great pick by him just like Uniply Industries!