Bhageria Industries : A Multi-Bagger Stock

                                 BHAGERIA INDUSTRIES : A Multi-Bagger Stock

CMP : 348-355

BSE CODE :530803

Market Cap : 553 Crores

       LISTED ON : NSE AND BSE

TARGET : 750/850

TIME-FRAME : 12 Months

History of the Company :

Bhageria Industries Ltd was established in the year 1989 with an objective to serve dyes & intermediates industry all over the globe. Company commenced its operations by setting up a Vinyl Sulphone Plant at Vapi (Gujarat) with capacity of 540 T.P.A which has now expanded to 3600 T.P.A 

Nearly 70% of its production is being exported to countries like Korea, Japan, Taiwan, China, Germany, USA and other European and African Countries.

Main Business Activities : 

• Manufacturing of Dyes and Intermediates
• Sourcing and Exporting various Pharmaceutical products (APIs & FFs)
• Sourcing of various Bulk Chemicals 

Financials of the Company : 

• Profit After Tax (PAT) for the year ended on 31st March,2017 has been reported  at Rs 43.53 Crore and turnover at Rs 344 Crore.
• As per the numbers as on 31st March,2017 the company has generated Return on Equity of approx. 43% , Return on Capital Employed of 43% and Return on Assets of 26%
• The company is a regular dividend paying company and has paid dividend for past 5 consecutive years.
• Debt to Equity ratio is below 2 and is reasonable in nature
• The company has carried out a major expansion in 2017 and fixed asset base has increased from 23 crores to 144 crores which is almost 600% surge. Operating margins have improved in last 2 quarters and turnover is also likely to improve.

Investment Rationale : Why to Invest in this Stock ??

• Shareholding of the promoters in the company is 53.92% as on 31st March,2018 which strongly indicates interest of promoters in growth of the company. Promoter shareholding has been consistently increasing since past 4 quarters.
• Market Cap to Sales Ratio : 1.59  is attractive for a chemical company
• After completion of expansion the Operating margin of the company has increased by almost 10% in last 2 quarters
• At current price of 350 Rs per share and EPS of 25 Rs on trailing basis , the stock is presently trading at an attractive P/E ratio of 14.
• At a forward reasonable P/E of 25 and EPS of 30.00, we expect the stock price to soar higher atleast to 750 and higher levels in coming time.

Disclaimer Note: The above is not a research report but information as available on public domain and it should not be treated as a research report. Registration status with SEBI: 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.

Disclosure: It is safe to assume that I might have Bhageria Industries Ltd  in my portfolio and hence my point of view can be biased. Readers should perform own due diligence before investing. We do not assume any responsibility or liability resulting from the use of information , judgments and opinions for Trading or Investment purposes on the Blog.