Reviews
Review
In this edition, we have reviewed Parag Milk Foods & Bhansali Engineering Polymers. We suggest our reader-investors to hold in Parag Milk Foods and Bhansali Engineering Polymers We had previously recommended Parag Milk Foods in Volume 33 Issue no. 23, dated October 15-28, 2018 under the ‘Cover Story’ segment.
It was recommended based on positive quarterly financial performance, bullish outlook on future and due a competitive edg amongst its peers. Parag Milk Foods is engaged in manufacturing, processing, branding and distributing a range of dairy products. Its popular brands include Gowardhan, Go, Topp, Mikrich, Slurp, Pride of Cows, etc. The company offers a diverse portfolio of products consisting of cheese, ghee, fresh milk, whey protein, paneer, curd, yogurt, milk powder and other dairy based products.
On consolidated financial front, the company posted the net sales of Rs629.74 Crore for Q1 FY20, up by 14.62 per cent from Rs549.42 Crore in Q1 FY19. The PBDT was Rs50.35 Crore, depicting a fall of 1.78 per cent in Q1 FY20 from Rs51.26 Crore posted in Q1 FY19. It witnessed a net profit of Rs27.51 Crore in Q1 FY20, a decrease of 2.69 per cent compared to the net profit of Rs28.27 Crore in Q1 FY19. On the annual front, the net sales came in at Rs2,395.66 Crore in FY19, up by 22.57 per cent from Rs1,954.51 Crore in FY18. The PBDT in FY19 has increased by 16.76 per cent to Rs197.97 Crore from Rs169.55 Crore in FY18. The company’s net profit in FY19 was Rs120.72 Crore, up by 38.66 per cent from Rs87.06 Crore posted in FY18.
With the addition of ready-to-eat Indian desserts, Parag Milk Foods continues to expand its product portfolio. It also launched it premium fresh milk brand, Pride of Cows, recently. The company intends to expand and strengthen its distribution network in the north Indian markets in the near future. Therefore, we recommend a HOLD.
We had previously recommended Bhansali Engineering Polymers Ltd. Volume 33 Issue no. 23, dated October 15-28, 2018 under the ‘Cover Story’ segment. It was recommended based on capacity expansion, increasing consumption on ABS and strong financial performance.
Bhansali Engineering Polymers Ltd. (BEPL) is a leading name in the petrochemical sector in India. The company is a vertically integrated petrochemical enterprise, engaged into manufacturing of Acrylonitrile Butadiene Styrene (ABS). ABS is a raw material, used extensively across various industries, such as automobiles, home appliances, telecommunications, and luggage. BEPL boasts of a rich clientele that includes a number of major Indian brands, such as Bajaj, Exide, Fiat, Aquaguard, Beetel, VIP, Samsonite, BPL, Onida, Sanyo, Videocon, Voltas, Whirpool, Electrolux, Crompton, IFB, LG, Kenstar, Tata, and Toyota. On the standalone financial front, the company posted its revenues to the tune of Rs367.65 Crore for Q1 FY20, up by a whopping 54.47 per cent from Rs238 Crore in Q1 FY19. The PBDT stood at Rs29.1 Crore, displaying a rise of 5.74 per cent in Q1 FY20 from Rs27.52 Crore posted in Q1 FY19. It witnessed a net profit of Rs21.92 Crore in Q1 FY20, a jump of 21.92 per cent compared to the net profit of Rs16.77 Crore in Q1 FY19. On the annual front, the net sales came in at Rs1,443.91 Crore in FY19, up by 19 per cent from Rs1,204.55 Crore in FY18. The PBIDT dropped to Rs79.02 Crore in FY19, depicting a decline of 48 per cent from Rs54.43 Crore in FY18. The company’s net profit in FY19 was Rs46.53 Crore, down by 53 per cent from Rs99.64 Crore posted in FY18. Hence, we recommend a HOLD to our investor-readers.