BDH Industries : Small Cap Gem

                                        BDH Industries : Small Cap Gem

CMP : 76-78

BSE CODE : 524828

Market Cap : 44 Crore

LISTED ON : BSE

TARGET : 150/175

Time Frame : 24 Months 

History of the Company :

BDH Industries started off as fledging unit in 1935. It has grown into a major facility and earned global acclaim. BDH industries is engaged in the manufacturing of therapeutic formulations covering a range of pharmaceuticals. Company offers a range of oral solid dosage (OSD) technologies. The company offers its products in various therapeutic classes, such as antifungal, antibiotics, anticancer, anti-diabetic, antidepressant, anti-ulcerant, antimalarial, anti-inflammatory, analgesic, antispasmodic, anti-tuberculosis, cardiovascular, dermatological, non-steroidal anti-inflammatory drugs, psychotropic, trichology, and vitamins and minerals.

Company has state of art manufacturing plant comprising of 42,500 square feet which meets WHO GMP standards. Fully automated manufacturing system gives company unique capability to go into wide range of dosage forms such as tablets, capsules, external ointment, small volume parenterals etc.

Company exports to over 60 countries across the globe and has won many awards for its performance in the business

Main Business Activities : 

• Formulations
• Speciality Formulations

Financials of the Company : 

• Profit After Tax (PAT) for the year ended on 31st March,2018 has been reported  at Rs 3.76 Crore and turnover at Rs 41.01 Crore.
• As per the numbers as on 31st March,2018 the company has generated Return on Equity of approx. 13%,Return on Capital Employed of 15% and Return on Assets of 10%
• The company is a regular dividend paying company and has paid dividend for past 8 consecutive years.
• Debt to Equity ratio is below 1 and is reasonable in nature
• The company has carried out a major expansion in 2017 and the impact of same is gradually visible on top and bottom line in this year

Investment Rationale : Why to Invest in this Stock ??

• Shareholding of the promoters in the company is 55% indicating strong interest of promoters in the business  as on 30th December,2018
• Market Cap to Sales Ratio : 0.78  is very attractive for a Pharma Company
• OPM (Operating Profit Margin) of the company is gradually improving since past 3 years
• At current price of 76 Rs per share and EPS of 9 Rs on trailing basis, the stock is presently trading at an attractive P/E ratio of 8
• At a forward reasonable P/E of 15 and EPS of 10, we expect the stock price to soar higher atleast to 150 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 BDH Industries 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.