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SHARETIPSINFO >>Research Reports >>PIDILITE INDUSTRIES LTD (05-09-2009)
LISTING |
|
|
Rs 145 |
|
Rs 152/Rs78 |
|
Rs 1 |
PE RATIO |
21 |
AVERAGE VOLUME |
62000 |
MARKETCAP |
Rs 3854 crore |
COMPANY OVERVIEW:
Pidilite is a consumer and specialty chemical company. Company was established in the year 1959.Pidilite is the leader is leader in the adhesive and sealants. The company product range includes Adhesives and Sealants, Construction and Paint Chemical, Automotive Chemical, Art Materials, Industrial Adhesives, Industrial and Textile Resins and Organic Pigments and Preparations. Its brand Fevicol is very much known to every Indian. Fevicol is also ranked as the most trusted brand in India.
The company operates under two major business segments:
Branded Consumer & Bazaar Product: Product such as Adhesives, Sealants, Art Materials, Construction and Paints Chemical are covered under it.
Specialty Industrial Chemical: It covers Industrial Adhesives, Synthetic Resins, Organic Pigments, Pigments Preparation, Surfactants, etc. and caters to the industries like packaging, textiles, paints, printing inks, paper leather etc.
Company also manufactures Vinyl Acetate Monomer. It has installed capacity of 30000 MT per annum.
PRODUCT MIX:
PRODUCT |
SALES VALUE(In Crore) |
% of the Total |
Chemicals |
Rs1110 crore |
58.4% |
Chemicals |
Rs346.09 crore |
18.19% |
Dyestuffs |
Rs168.25 crore |
8.84% |
Dyestuffs |
Rs113.54 crore |
5.96% |
Others |
Rs107.3 crore |
5.64% |
Others |
Rs51.15 crore |
2.68% |
Other fiscal benefits |
Rs4.66 crore |
0.24% |
INVESTMENT RATIONAL:
Strong brand presence in the Indian market helps the company in keeping the competitor at bay. It Fevicol is the most trusted brand in India. Dr. Fixit the other brand is well received in sealant and adhesive industry.
Sales are growing at CAGR of 22% over the last four years.
Net profit grew at CAGR of 23%.
Controls 30% share in domestic adhesive market.
Company is expanding in various segments of adhesive and sealants market.
Declining raw material cost is increasing the margin.
Company is growing organically and inorganically. Company has till now 13 oversea acquisitions.
Company has history of consistent dividend payout.
Company has close to Rs160 crore cash which translate to Rs6 per share.
As festive season is approaching company is expected to benefit most.
Company bought FCCB at considerable discount.
SHAREHOLDING PATTERN:
|
|
NO.OF SHARES |
% OF TOTAL |
PROMOTERS |
179381757 |
|
70.88% |
|
INSTITUTION |
44743236 |
|
17.68% |
|
GENERAL PUBLIC |
28942313 |
|
11.44% |
|
GRAND TOTAL |
253067306 |
|
100.00% |
|
FINANCIAL:
|
|
31/03/06 |
31/03/07 |
31/03/08 |
31/03/09 |
TOTAL INCOME |
1061.72 |
1309.1 |
1727.7 |
1931.16 |
EXPENDITURE |
-901.27 |
-1118.3 |
-1443 |
-1671.29 |
PBDITA |
|
160.45 |
190.8 |
284.7 |
259.87 |
DEPRECIATION |
-27.48 |
-30.3 |
-38.5 |
-47.22 |
PBIT |
|
132.97 |
160.5 |
246.2 |
212.65 |
INTEREST |
|
-1.47 |
-6.3 |
-16.1 |
-31.78 |
PBT |
|
131.5 |
154.2 |
230.1 |
180.87 |
TAX |
|
-42.6 |
-34.3 |
-36.3 |
-16.82 |
PAT |
|
88.9 |
119.9 |
193.8 |
164.05 |
Key Highlights:
Total Income grew at CAGR of 22.1%
PBDITA grew at CAGR of 17.5%.
Net Profit grew at CAGR of 23%.
RATIOS:
|
|
31/03/06 |
31/03/07 |
31/03/08 |
31/03/09 |
EPS |
|
3.513834 |
4.73913 |
7.660079 |
6.48419 |
PBDITA MARGIN |
15.11227 |
14.5749 |
16.47856 |
13.45668 |
NPM |
|
8.373206 |
9.158964 |
11.21723 |
8.494894 |
INTEREST COVER |
88.64667 |
25.47619 |
15.3875 |
6.859677 |
Key Highlights:
EPS has consistent growth. It has grown at CAGR of 22.1%.
PBDITA margin remained more or less stable.
NPM remained stable.
Interest cover has decline over the period but still very healthy.
COMPARISION OF Q1FY2010 WITH Q1FY2009:
|
|
Q1FY09 |
%CHANGE |
Q1FY10 |
TOTAL INCOME |
501.6 |
4.40% |
|
522.58 |
EXPENDITURE |
-409.27 |
|
|
-405.45 |
PBDITA |
|
92.33 |
26.80% |
|
117.13 |
DEPRECIATION |
-10.62 |
|
|
-11.42 |
PBIT |
|
81.71 |
|
|
105.71 |
INTEREST |
|
-5.11 |
|
|
-7.59 |
PBT |
|
76.6 |
|
|
98.12 |
TAX |
|
-9.43 |
|
|
-13.97 |
PAT |
|
67.17 |
25.30% |
|
84.15 |
Key Highlights:
Total Income grew by 4.4%.
PBDITA grew by more than 26%. The growth is due to the increase in operational efficiency. The decline in the raw material cost has helped company tie the operational cost.
Net Profit grew at 25%.
VALUATION:
At CMP of Rs145 company stock is trading at 21X to FY09 earning and 16X to FY10 earning. We expect FY10 EPS to be around Rs9.5 and we value the company at 20X. The fair value we arrive at is Rs190 per share.
CONCLUSION:
Investors with 6months to 8months time horizon could take exposure on the counter.
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