Where To Invest In 2017

Indian equity markets are in one of their most interesting phases in 2016. There was clamour for more economic reforms in India and India did get one in the form of demonetisation, which almost shook the whole nation. Demonetisation, which virtually bought the economy to a standstill, has been touted as extremely beneficial in the long run, but it might have almost pushed the Indian equity markets into a strangulating bear hug. The prices of stocks climbed considerably high till the month of September from its lows made in the month of February of 2016. Markets gained by almost 20 per cent in just 7 months in 2016, which also was the highlight of the year until two events affected the market sentiment negatively, viz., the US presidential election and the demonetisation move that made use of Rs.500 and Rs.1000 currency notes illegal after November 8th midnight.

Till demonetisation happened, the markets had focused on corporate earnings and the developments on the gross and net non-performing assets (NPAs) affecting the banking industry as a whole, along with the GST. Even as the banking system is not yet out of woods with the NPA situation, the turbulence caused by demonetisation for the banking operations do not augur well for the profitability of both public and private sector banks. The year 2016 (Jan-Nov) was one of the great years for the IPO investors as the year saw a very good number of qualityIPO issues hitting the markets and listing at hefty premiums. In total, 88 IPOs succeeded during the said period, with just one issue failing. Fresh capital to the tune of Rs.21,500 crore was raised by these 88 companies.

The whole of CY2016 was ruled by the BSE Metal index as this Index was the best performer, far outperforming the second best index gainer by almost 75 per cent. The second best performer was Oil & Gas index which recorded gains of almost 25 per cent during the period. Both BSE IT and BSE Healthcare indices were seen underperforming the markets, which had visible impact on the investors' portfolios as they have decent amount of exposure to these two sectors. BSE PSU index was a surprise outperformer in 2016. The index gained by an impressive 14.7 per cent in 2016. BSE Bankex just missed delivering a double digit return by clocking a gain of 9.6 per cent. The index performance was a tad disappointing as it was widely expected that the banking and financial sector could be the top performer in 2016.

The participation of FIIs has been muted since last year when compared to the DIIs' trading activity. FIIs were net sellers in 2015 to the tune of Rs.20373.69 crore but at the same time the DIIs were net buyers pumping in Rs.67,586.82 crore. It was the first time in 2015 that DIIs participation

overshadowed that of FIIs and the trend continued in 2016 as well with DIIs net inflow into markets being Rs.26,226.47 crore as compared to FIIs paltry net inflows of Rs.743.02. In the coming quarters, the fund inflow into the markets is expected to be steady with concerns over demonetisation ebbing down the sentiment to a more realistic level, but the attractive valuations will play a crucial role in attracting institutional money. ECONOMY On the macroeconomic front, the Indian economy managed to perform well by keeping its growth rates within acceptable range. The crude oil prices remained subdued but rising USD will be a concern going forward. Also, the rise in crude oil prices along with rising USD could be damaging India’s hope to stay in surplus zone when it comes to its EXIM trades. Demonetisation has definitely raised several eyebrows and there are several economists who believe the current demonetisation will negatively impact the economy as the unaccounted money was one of the major reason behind the consumption-led growth in India. Before demonetisation, the economy actually saw decent amount of performance and efficiency.

The consumption story remained intact in 2016 and was indeed one of the two contributors, apart from net exports, to the GDP growth. As is reflected in the table below consumption and external contribution has kept the economy in momentum whereas the investments have been a drag.

Also, the difference between consumption and investments in India is widening which may not augur well for the country in the long run. The investment cycle needs to pick up and there could be myriad reasons why it is not happening, including NPA issue faced by the banks which may leave these banks with little money to lend to the end-user.

Inflation is expected to ease and the interest rates are expected to come down in the coming fiscal. A cut of 50 bps is expected in the coming fiscal and market participants are already factoring rate cut post-demonetisation. On the global front, the Italian referendum and the US Fed rate decision will weigh on global markets, which may have a rub off effect on the Indian markets. 

CONCLUSION: Rising crude oil prices with rising USD could pose problem to the sound health of the Indian economy. If OPEC decides to cut oil output in the coming quarters, it may lead to increase in crude oil prices. The impact of demonetisation needs to be assessed in coming days. The developments on the GST front, RBI decision on interest rates followed by preponed budget session all indicate to a volatile beginning to the new year 2017. The implementation of the GST regime will be a key factor in the coming year. Malaysia, a country with a large-sized economy, recently adopted GST and it took them whole eight months to implement GST countrywide. For India, it is anybody’s guess how much time GST implementation may take, but for sure it will not be implemented as early as people would like to believe.

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GST may not be the big trigger in 2017 for equity markets. Select sectors that will benefit from digitisation and e-commerce spend can be looked at as investment opportunities. The consumer spend is on the rise and remains a key contributor to the economy. Investors may choose to be cautiously optimistic in 2017 as the market is not showing any sign of a clean upmove in the coming year.

The emerging markets are expected to remain under pressure, atleast in the first half of the coming year. Banks will stay in focus with so much happening for the banking system. Only select banks that are able to get customers on board to transact digitally and maintain balance between personal touch and digital banking will stand to gain market share profitably. Banks having strong balance sheet and winning digital strategy and are able to inspire brand loyalty in customers may well turn out to be clear outperformers in 2017. How banks react and respond to the demonetisation in terms of asset liability management will prove crucial in the coming year for the performance of these banks. For many foreign investors, the Trump win in the US election is a game changer as he is expected to unleash a trillion dollar stimulus through tax cuts and infrastructure spending.

With increasing inflation and expected rate hike, money is getting invested in the US bond markets. If FIIs continue to pull out of the emerging markets, the negative impact on stock prices coupled with the damage it can cause to bond yields and the currency, will be something that may keep investors on the risk-off mood. In 2016, the FIIs were marginally positive in terms of net inflows into Indian equities and the markets could sustain the FIIs' selling pressure owing to healthy and active participation from DIIs in the recent three to four months. Having discussed the challenges for markets, the opportunities for investors lie in identifying stocks having bargain valuations. Sensex is currently trading at P/E of 20.72.

The valuations after the current fall may get extremely attractive if the fall continues and that could be the right time for purchasing Indian stocks. Happy Investing !

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Where to Invest in 2017: Portfolio recommendations

APL Apollo Tubes (APL Apollo)

Here Is Why

Company has lined up both green field and brownfield expansion plans

Strong geographical footprint

Robust financial performance and attractive valuations

Global steel market is approximately 1700 million tonnes amounting to USD 1000 billion. Meanwhile, welded steel has a market of about 170 million tonnes to USD 100 billion. Indian ERW Steel tubes’ market is about 7 million tonnes amounting to Rs 30000 crore. India is among the leading ERW steel tubes manufacturing hubs in the world – Other bigger manufacturers include China, Turkey, Italy and US.

APL Apollo has over 600 distributors and 26 warehouses in FY16. The company has current capacity utilisation at 85 per cent.

APL Apollo is setting up a new plant in Raipur with two lakh TPA for establishing presence in Pan India. The company has also initiated plans for a new plant in UAE with a total capacity of three lakh TPA with six lines. It has ordered 8 lines of new HSU technology mills that will add over five lakh TPA at the existing sites in current year.

APL Apollo is venturing into precision tubes for Automotive applications with a greenfield site in Bangalore (one lakh TPA). The company is also setting up an online Galvanising plant of 1 Lakh TPA in Bangalore for the first time in India. Its overall capex amounts to Rs 500 crore in the next three years.

On the financial front, APL Apollo’s sales volume has increased by 11 per cent to 4.75 lakh tonnes in H1FY17 as compared to same period in previous financial year. The company’s revenue has increased by 3.28 per cent to Rs 1865 crore in H1FY17 on a yearly basis. Its EBITDA too has risen by 36 per cent to Rs 176 crore in H1FY17 as compared to same period in previous fiscal. APL Apollo’s EBITDA margin has expanded by 220 basis points to 8.4 per cent in H1FY17 on a yearly basis. The company’s net profit has improved by 79 per cent to Rs 75.1 crore in H1FY17 as compared to same period in previous financial year.

APL Apollo’s top line has increased by 24.79 per cent CAGR from FY12-FY16 period. The company’s EBITDA too has risen by 19.75 per cent from last five financial years. Its bottom line has increased by 15.44 per cent CAGR for FY12-FY16.

On the geographical segmental revenue front, APL Apollo has earned 37 per cent from South, 33 per cent from West, 23 per cent from North, 1 per cent from Central and 6 per cent from Exports in FY16. Considering, the company’s product wise revenue break up, it has earned 35 per cent from Hollow-Sections, 25 per cent from MS Black, 24 per cent from Pre-Galvanised Tubes and remaining 16 per cent from Galvanised Tubes in FY16.

On the valuation front, APL Apollo’s share price is trading at PE multiple of 15.79x times against industry PE multiple of 26.55x times, which is quite attractive. The company’s EPS stands at Rs 56.7 and has given dividend yield of 1.12 per cent to its shareholders.

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Advanced Enzyme Technologies

Here Is Why

Sole industry player being an advantage to the company

Company has strong number of patents and trademarks

Advanced Enzyme Technologies has low debt to equity ratio

Enzyme belongs to the niche industrial sector. Enzymes are sustainable alternatives to hazardous chemicals used in many industrial bio-chemical processes. The global enzyme market stood at USD 5.1 billion in 2012, which is expected to grow by a CAGR of 6.3 per cent every year to USD 7.0 billion in 2017. Market is further expected to grow at a 5 year CAGR of 6.5 per cent after 2017. Enzymes are split into two segments:  Industrial Enzymes and Speciality Enzymes.

Advanced Enzyme Technologies (AETL) deals in specialised business with a high entry barrier. The company enjoys second highest market share on the domestic front and stands next only to the world's largest enzyme company Novozymes. The firm is engaged in research, development, manufacturing and marketing of over 400 proprietary products developed from 60 indigenous enzymes.

AET’s IPO has raised around Rs 400 crore by sale of 40 lakh shares for face value of Rs 10 through offer for sale by existing shareholders.

The company operates in two primary business verticals, namely, Healthcare & Nutrition contributing (87.6 per cent of revenue in FY16); and Bio-Processing (12.4 per cent of revenue). AET sells these products to more than 700 global customers spread across 50 countries. In terms of geographical presence, USA, India, Asia (ex-India), Europe and other geographies accounted for 54.9, 36.4, 3.6, 3.8 and 1.2 per cent of total revenues, respectively in FY16. US is an important focus market for the company, which contributes to a major portion of international revenues.

AETL has 13 patents and 172 trademarks registered in its name, with 4 patents and 14 trademarks pending before relevant authorities. The  Enzyme industry at global and domestic front is expected to rise by a CAGR of 6.4 per cent and 15 per cent respectively. Changing food habits from junk to healthy; healthy market share in US and Indian market; and high entry barrier all provide a significant growth potential to AETL in near future.

AETL has been seeing a growth in revenue at a CAGR of 16.73 per cent over FY11 to FY16. The company’s EBITDA and bottom line also has boosted at a CAGR of 34.73 per cent and 28.72 per cent respectively in last six financial years.

AETL’s revenue has expanded by 32 per cent in FY16 on a yearly basis, which looks much better than de-growth in FY15, by 7 per cent. The company’s EBITDA and PAT margin have been spiked by 47 per cent and 27 per cent respectively in FY16 on a yearly basis. It also enjoys low debt status with net debt-equity ratio of 0.2x times in FY16. We can see fair growth numbers in FY17 driven by enzyme demand at global and domestic level.

Considering latest financials, it should be noted that AETL’s revenue has increased by 33.45 per cent to Rs 185 crore in H1FY17 as compared to same period in previous financial year. The company’s EBITDA too has risen by 68.66 per cent to Rs 93.1 crore in H1FY17 on a yearly basis. Its net profit has boosted by 71.41 per cent to Rs 57.42 crore in H1FY17 as compared to same period in previous fiscal.

AETL does not stand with any peer set, being a niche business segment. The company’s EPS of 33.97 looks attractive with PE of 63.04x times. AETL enjoys ROCE of 35.68 per cent and ROE of 31.32 per cent in FY16. Huge demand for enzymes and sole market position creates a win-win situation for the company.

HDFC Bank

Strong Retail franchise

Mainlining asset quality metrics

Robust financial performance

HDFC Bank boasts of a strong operating performance by rich franchises both on the asset and liability side that helps put up a superior margin show and operating profitability each quarter. The bank’s NIMs on an annual basis have declined given the liquidity, owing to Foreign Currency Non-Resident (FCNR) redemption; however, they are stable on a QoQ basis at 4.2 per cent. The bank is confident of maintaining NIMs’ traction.

HDFC Bank’s distribution network was at 4548 branches and 12016 ATMs across 2596 cities. Meanwhile, 54 per cent branches are spread across semi-urban and rural areas.

HDFC Bank’s earning has grown almost 10 times in last ten years. The bank’s NII has witnessed 17.32 per cent CAGR from FY12-FY16. Its operating profit before provisions too has risen at a CAGR of 18.58 per cent from last five financial years. HDFC Bank’s bottom line also has boosted at a CAGR of 19.44 per cent from FY12-FY16.

On the financial front, HDFC Bank’s interest earned has increased by 16.56 per cent to Rs 33586 crore in H1FY17 as compared to same period in previous financial year. The bank’s NII too has risen by 20.7 per cent to Rs 15775 crore in H1FY17 on a yearly basis. Its net profit also has increased by 20.3 per cent to Rs 6694 crore in H1FY17 as compared to same period in previous fiscal.

HDFC Bank’s Capital Adequacy Ratio (CAR) as per Basel III guidelines stands at 15.4 per cent in Q2FY17 against 15.5 per cent in Q2FY16. Its Tier-I stands at 13.3 per cent in Q2FY17 against 12.8 per cent in Q2FY16.

HDFC Bank’s loan growth has moderated to 18 per cent YoY as compared to 23 per cent YoY in Q1FY17 because of slower growth in the corporate book. The bank’s retail loan book growth stands at a robust 23.5 per cent YoY driven by strong growth in auto loans (23 per cent), personal loans (40 per cent) and agricultural loans (35 per cent).  Meanwhile, its growth in corporate book has remained moderate at 13 per cent in Q2FY17 on a yearly basis.

On the asset quality front, HDFC Bank’s gross non-performing assets (GNPAs) stand at 1.02 per cent in Q2FY17 against 1.04 per cent in Q2FY16. The company’s net NPA stands at 0.3 per cent in Q2FY17 against 0.1 per cent in Q2FY16.

On the valuation front, HDFC Bank’s share price is trading at PE multiple of 23.48x times against industry PE multiple of 18.49x times. The peers are having PE multiple as follows: Kotak Mahindra (32.03x), Axis Bank (13.32x), ICICI Bank (14.62x). HDFC Bank is trading at PB multiple of 4.04x times. It has given dividend yield of about 0.81 per cent.

Kingfa Science and Technology

Here Is Why

Company has acquired a plot at Chakan in Pune for setting up its manufacturing facility

Strong financial performance

Consolidation of company’s business

Kingfa Science & Technology India (KSTIL) (formerly Hydro S & S Industries), one of the leading players in the Asia Pacific plastics market, manufactures polypropylene as well as engineered plastics & elastomers which find applications in automotive and consumer durable industries. The Company's products and materials are used in automobile, electronic appliances, industrial equipment, consumer goods, packaging and toys among others. Its manufacturing facilities are located at Pudukkottai in Tamil Nadu; Puducherry; Jejuri in Pune and Manesar in Delhi. It has a total compounding capacity of approximately 35000 million metric tons annually (MTA).

KSTIL has acquired a plot at Chakan in Pune via the Maharashtra Industrial Development Corporation (MIDC) for setting up its manufacturing facility. The company also has signed the lease agreement for the land.

KSTIL, one of the leading compounders in China, has forayed into India by acquiring controlling stakes in Hydro S&S Industries in 2013 for USD 18 million (Rs 123 crore). KSTIL has been consolidating its position in the country through acquisition and organic expansion. From Company’s new manufacturing site, its first production base outside China is reportedly planning to integrate its production, R&D, sales and marketing activities in India.

On the financial front, KSTIL’s top line has increased at a CAGR of 15.99 per cent from FY12-FY16. The company’s operating profit too has risen at a CAGR of 24.78 per cent from last five financial years. Its bottom line has surged from Rs 3 lakh in FY12 to Rs 10.8 crore in FY16.

Considering latest financials, it should be noted that KSTIL’s net sales have increased by 34.09 per cent to Rs 200 crore in H1FY17 as compared to same period in previous financial year. The company’s EBITDA has risen by 28.88 per cent to Rs 13.11 crore in H1FY17 on a yearly basis. KSTIL’s net profit also has boosted more than four folds to Rs 6.74 crore in H1FY17 on a yearly basis. The company’s net profit margin has expanded by 224 basis points to 3.37 per cent in H1FY17 as compared to same period in previous fiscal.

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MT Educare

Here Is Why

Strong financials and attractive valuations

Expansion in various geographies other than strong footmark in Maharashtra and Karnataka

Consistent growth across segments

India holds an important place in the global education industry. The country has more than 1.4 million schools with over 227 million students enrolled and more than 36,000 higher education institutes.  India has become the second largest market for e-learning after the US. The sector is currently pegged at USD 2-3 billion, and is expected to touch USD 40 billion by 2017. There is still a lot of potential for further development in the education system.

MT Educare (MTEL) network consists of 174 coaching locations in 13 states and union territories including Maharashtra, Karnataka, Tamil Nadu, Gujarat, Assam, Punjab, Haryana, Chandigarh, Kerala, Odisha, Uttar Pradesh, Andhra Pradesh and Telangana. The company enjoys an asset light business model and high ROE of 22 per cent in FY16.

MTEL has focus on developing the CBSE & ICSE business verticals as a pillar of strength to enable rapid scalability of operations in the school segment across all states in India. The company is tying up with local coaching classes in Tier-III and Tier-IV towns in Rest of Maharashtra and Gujarat for sale of Robomate to their students and for providing TAT and teacher training. It has 22 operational Pre-University college tie-ups across Karnataka for K-CET test prep coaching and is aiming to tie-up with a total of 30 colleges by year 2018-19. MTEL is expanding CA video classrooms into South India through the franchisee model.

Considering latest financials, it should be noted that MTEL’s revenue has increased by 8.66 per cent to Rs 171 crore in H1FY17 as compared to same period in previous financial year. The company’s EBITDA too has risen by 12.32 per cent to Rs 36.57 crore in H1FY17 on a yearly basis. Its EBITDA margin has expanded by 70 basis points to 21.3 per cent in H1FY17 as compared to same period in previous fiscal. MTEL’s PAT remains flat at Rs 19.25 crore in H1FY17 on a yearly basis.

On the segmental revenue front, MTEL has earned 28.4 per cent from schools, 31.8 per cent from commerce and UVA, 34.75 per cent from science and remaining 5.05 per cent from robomate in H1FY17.

On the financial front, MTEL’s top line has increased by CAGR of 9.07 per cent from last five financial years, ending FY16. The company’s EBITDA too has risen by 18.1 per cent CAGR for FY12-FY16. Its bottom line also has boosted by CAGR of 16.24 per cent from last five fiscal years, till FY16.

MTEL’s revenue has increased by 3.84 per cent to Rs 193 crore in FY16 as compared to previous financial year. The company’s EBITDA has spiked by 22.78 per cent to Rs 54.7 crore in FY16 on a yearly basis. It has posted net profit of Rs 29.22 crore with gain of 4.88 per cent in FY16 as compared to previous fiscal.

On the valuation front, MTEL’s share price is trading at PE multiple of 14.35x times as compared to industry PE multiple of 48.96x times, which is quite attractive. It is also attractive as compared with peers: ZEE Learn (88.58x), Tree House Education (21.36x), Greycells Education (54.89x). The company has given dividend yield of 1.73 per cent.

Navin Fluorine International

Here Is Why

Company has joined hands with Piramal Enterprises to cater to speciality fluorochemicals.

Hearty financials and management forecasts for strong growth in upcoming couple of quarters

Navin Fluorine International (NFIL) is engaged in the chemicals business. The company focuses on fluorine chemistry, producing refrigeration gases, some basic building block fluorides and specialty organofluorines.

NFIL’s chemical complex at Surat spread over 135 acres, houses Refrigerants, Inorganic Fluorides & Specialty Chemical Plants. The company has cGMP compliant pilot plant for CRAMS in Dewas. Its backward integration for raw material through 25 per cent JV partner is the only Fluorspar beneficiation company in India. NFIL has diversified sourcing of fluorospar from China.

NFIL is enjoying healthy margins due to continued pressure on key raw materials such as sulphur, fluorspar, chloroform & boric acid during the past 12-15 months. The lower material cost and operational efficiencies will provide room for margin expansion in coming years.

NFIL has joined hands with Piramal Enterprises to develop, manufacture and sell speciality fluorochemicals for healthcare segment. The company’s product validation is in process. It has also entered into an agreement with Honeywell for a small-scale manufacturing project on HFO-1234 yf, next generation refrigerant gas with GWP less than 1 for use in vehicle air conditioning systems.

Considering latest financials, it should be noted that NFIL’s revenue has increased by 15 per cent to Rs 347 crore in H1FY17 as compared to same period in previous financial year. The company’s EBITDA too has risen by 40 per cent to Rs 80 crore in H1FY17 on a yearly basis. Its EBITDA margin has expanded by 416 basis points to 23.2 per cent in H1FY17 as compared to same period in previous fiscal. NFIL’s net profit also has increased by 37 per cent to Rs 57 crore in H1FY17 on a yearly basis.

On the segmental revenue front, NFIL has earned 18 per cent from CRAMS, 31 per cent from speciality chemicals, 16 per cent from inorganic fluorides and 34 per cent from refrigerant gases in H1FY17. On geographical revenue front, NFIL has earned 56 per cent from domestic and remaining 44 per cent from exports in H1FY17.

NFIL’s top line has increased by 14.95 per cent to Rs 678 crore in FY16 compared to previous financial year. The company’s operating profit also has boosted by 62.53 per cent to Rs 117 crore in FY16 on a yearly basis. Its bottom line also has expanded by 53.01 per cent to Rs 83.5 crore in FY16 as compared to previous fiscal.

As per NFIL’s management, the company is expecting 15 per cent revenue growth in FY17 and given the stellar growth in CRAMS & Refrigerant segment; and better outlook for speciality chemicals & inorganic fluorides, mid to high teen growth looks achievable.

On the valuation front, NFIL’s share price is trading at PE multiple of 26.82x times as compared to industry PE multiple of 21.42x times. The company has given EPS of Rs 85.32. It has given dividend yield of 0.92 per cent.

Parag Milk Foods 

Here Is Why

Strong growth across all segments

Company enjoys healthy debt to equity ratio

Huge demand for dairy products in the country

The middle-class households will grow from 25.5 crore in 2015 to 58.6 crore in 2025 at a CAGR of 8.7 per cent. Increasing income & disposable income will drive consumption of milk & dairy products. About 31 per cent Indian population is vegetarian, ensuring continuous demand for milk & dairy products. The organised dairy market will grow at 19.5 per cent CAGR in 2015-2020. At the same time, organised market share will also increase to 26 per cent in value terms, by 2020. Due to changing dietary patterns with focus on milk, there is room for the industry to outperform in future.

Parag Milk Foods (PMFL) is into manufacturing and processing of milk and milk products. The company offers a range of products viz. cheese, ghee, whey proteins, paneer, curd, yoghurt, milk products, liquid milk, milk-based beverages and milk powders. It has an aggregate milk processing capacity of about two million litres per day. PMFL has a product basket comprising over 150 stock keeping units (SKUs). Its manufacturing facilities are located in Manchar and Palamaner.

PMFL’s sales will grow in mid-teens in the medium term led by high-margin value added products, mix improvement and operating leverage, which will in turn enhance margins.  The company will start generating strong free cash flows from FY18. The current market valuation does not factor in strong growth expected in the medium term.

On the financial front, PMFL’s revenue has increased by 1.53 per cent to Rs 856 crore in H1FY17 as compared to same period in previous financial year. The company’s EBITDA has risen by 1.18 per cent to Rs 70.7 crore in H1FY17 on a yearly basis. PMFL’s net profit also has boosted by 50.38 per cent to Rs 25.14 crore in H1FY17 as compared to same period in previous fiscal.

On the segmental revenue front, PMFL has earned 66 per cent from Milk Products, 22 per cent from Fresh Milk, 11 per cent from Skimmed Milk Powder and 1 per cent from others in H1FY17.

PMFL’s net sales have increased by 17 per cent CAGR from FY12-FY16. The company’s EBITDA too has risen by 19 per cent CAGR from last five fiscal years. Its PAT has boosted by about 58 per cent from FY12-FY16.

PMFL’s topline has increased by 13.92 per cent to Rs 1645 crore in FY16 as compared to previous financial year. The company’s EBITDA too has risen by 37.7 per cent to Rs 147.6 crore in FY16 on a yearly basis. Its net profit also has boosted by 46.91 per cent to Rs 47.32 crore in FY16 as compared to previous fiscal. PMFL’s ROE and ROCE stand at 15.5 per cent and 16.2 per cent respectively in FY16. The company’s debt to equity ratio is quite healthy at 1.07x times in FY16.    

On the valuation front, PMFL’s share price is trading at PE multiple of 46.76x times against industry PE multiple of 32.47x times. Its PB multiple is trading at 3.33x times. The company’s EPS stands at Rs 5.63.