This stock turned Rs 1 lakh into Rs 6.50 lakh in five years, do you own it?
Currently, the stock is trading at 1075.10 level compared to Rs 163.23 five years ago. If you had invested Rs 1 lakh into the stock five years ago, the investment would be worth Rs 6.58 lakh today.
- Dec 27, 2018,
- Updated Dec 27, 2018 12:59 PM IST
The Astral Poly Technik stock has rewarded its investors with handsome gains during the last five years. The stock of Ahmedabad-based firm which is engaged in the production of plastic products, manufacturing and trading of pipes, fittings and adhesive solutions has delivered 562% returns to its investors during the last five years.
Currently, the stock is trading at 1075.10 level compared to Rs 163.23 five years ago. If you had invested Rs 1 lakh into the stock five years ago, the investment would be worth Rs 6.58 lakh today.
The company has clocked a constant rise in sales since 2013.
Sales rose to Rs 2,138.87 crore for fiscal ending March 2018 compared to Rs 825.20 crore for the fiscal ended March 2013.
Profit after tax too rose to Rs 178.32 crore for the last fiscal compared to Rs 60.61 crore for the fiscal ended March 2013.
Its book value too has risen during the last five years. For the last fiscal, the book value per share stood at 84.79 compared to 21.37 for the fiscal year ended March 2013.
Book value per share calculates the per share value of a company based on its equity available to common shareholders.
The firm has listed competitors such as Supreme Industries, Finolex Industries, Nilkamal and Essel Propack among others.
Meanwhile, ICICI Securities has upgraded its rating on the firm from HOLD to BUY citing strong balance sheet and likely revival of demand.
The brokerage said in a report:
"Astral Poly came out with a strong set of numbers in H1FY19 wherein revenue, PAT increased 20%, 30% YoY, respectively, led by impressive growth in the adhesive segment (revenue up 25% YoY). The piping segment revenue growth at 12% YoY was lower-than-expected mainly due to trucker's strike, floods in Kerala and fall in PVC prices, which led to sales deferral by dealers.
Despite this, EBITDA margins increased 200 bps YoY to 15.6% due to price hike (mainly in the adhesive segment), change in product mix and backward integration (mainly in the piping segment). We believe the recent correction in PVC prices (down 10% QoQ) would be limited to the company's PVC piping portfolio (30% of the total topline).
However, Astral would benefit from softening raw material prices (crude derivatives) in the adhesive segment where it has taken a price hike to the extent of 2-10% in H1FY19. We introduce our FY21E estimates with revenue, earning CAGR of 23%, 26%, respectively, in FY18-21E. We model piping and adhesive segment revenue CAGR of 23% and 22%, respectively, in FY18-21E.
Strong balance sheet, earnings visibility to support valuation We introduce our FY21E estimates with revenue, earning CAGR of 23%, 26%, respectively, in FY18-21E.
We reckon that a revival of the plastic piping industry is on the cards with government push on housing and infrastructure sector, implementation of GST and continued replacement demand from tier II, tier III cities.
In addition to this, strong balance sheet of the company (with D/E at 0.1x and RoE, RoCE at 23%, 17%, respectively,) coupled with strong free cash flow generation in FY20E-21E (as no major capex announced by the company for FY20-21E) would justify the premium valuation. We roll over our valuation on FY21E and upgrade our rating from HOLD to BUY with a revised target price of Rs 1250/share."
The company has its manufacturing facilities in India and abroad, and sells across the globe. Its pipe manufacturing facilities offer products, such as chlorinated polyvinyl chloride (CPVC) piping system for plumbing, industrial and fire protection; unplasticized PVC (UPVC) piping system for plumbing; manholes/chambers; PVC piping system for drainage; electrical conduit pipes; cyanoacrylates; solvent cements; tile adhesives; silicone sealant; putty; construction chemicals; polyurethane; acrylics; silicone sealants; waterproofing solutions, and silicone tapes.
Edited by Aseem Thapliyal
The Astral Poly Technik stock has rewarded its investors with handsome gains during the last five years. The stock of Ahmedabad-based firm which is engaged in the production of plastic products, manufacturing and trading of pipes, fittings and adhesive solutions has delivered 562% returns to its investors during the last five years.
Currently, the stock is trading at 1075.10 level compared to Rs 163.23 five years ago. If you had invested Rs 1 lakh into the stock five years ago, the investment would be worth Rs 6.58 lakh today.
The company has clocked a constant rise in sales since 2013.
Sales rose to Rs 2,138.87 crore for fiscal ending March 2018 compared to Rs 825.20 crore for the fiscal ended March 2013.
Profit after tax too rose to Rs 178.32 crore for the last fiscal compared to Rs 60.61 crore for the fiscal ended March 2013.
Its book value too has risen during the last five years. For the last fiscal, the book value per share stood at 84.79 compared to 21.37 for the fiscal year ended March 2013.
Book value per share calculates the per share value of a company based on its equity available to common shareholders.
The firm has listed competitors such as Supreme Industries, Finolex Industries, Nilkamal and Essel Propack among others.
Meanwhile, ICICI Securities has upgraded its rating on the firm from HOLD to BUY citing strong balance sheet and likely revival of demand.
The brokerage said in a report:
"Astral Poly came out with a strong set of numbers in H1FY19 wherein revenue, PAT increased 20%, 30% YoY, respectively, led by impressive growth in the adhesive segment (revenue up 25% YoY). The piping segment revenue growth at 12% YoY was lower-than-expected mainly due to trucker's strike, floods in Kerala and fall in PVC prices, which led to sales deferral by dealers.
Despite this, EBITDA margins increased 200 bps YoY to 15.6% due to price hike (mainly in the adhesive segment), change in product mix and backward integration (mainly in the piping segment). We believe the recent correction in PVC prices (down 10% QoQ) would be limited to the company's PVC piping portfolio (30% of the total topline).
However, Astral would benefit from softening raw material prices (crude derivatives) in the adhesive segment where it has taken a price hike to the extent of 2-10% in H1FY19. We introduce our FY21E estimates with revenue, earning CAGR of 23%, 26%, respectively, in FY18-21E. We model piping and adhesive segment revenue CAGR of 23% and 22%, respectively, in FY18-21E.
Strong balance sheet, earnings visibility to support valuation We introduce our FY21E estimates with revenue, earning CAGR of 23%, 26%, respectively, in FY18-21E.
We reckon that a revival of the plastic piping industry is on the cards with government push on housing and infrastructure sector, implementation of GST and continued replacement demand from tier II, tier III cities.
In addition to this, strong balance sheet of the company (with D/E at 0.1x and RoE, RoCE at 23%, 17%, respectively,) coupled with strong free cash flow generation in FY20E-21E (as no major capex announced by the company for FY20-21E) would justify the premium valuation. We roll over our valuation on FY21E and upgrade our rating from HOLD to BUY with a revised target price of Rs 1250/share."
The company has its manufacturing facilities in India and abroad, and sells across the globe. Its pipe manufacturing facilities offer products, such as chlorinated polyvinyl chloride (CPVC) piping system for plumbing, industrial and fire protection; unplasticized PVC (UPVC) piping system for plumbing; manholes/chambers; PVC piping system for drainage; electrical conduit pipes; cyanoacrylates; solvent cements; tile adhesives; silicone sealant; putty; construction chemicals; polyurethane; acrylics; silicone sealants; waterproofing solutions, and silicone tapes.
Edited by Aseem Thapliyal