Orient Cement Ltd

Orient Cement Ltd
Cement and Cement Products

FV – Re 1; 52wks H/L – 198/128; TTQ – 15000; CMP (May 12, 2016) – Rs 155;

Market Cap – Rs 3167 Crs

Standalone Financials and Valuations for FY16 (Amt in Rs Crs unless specified)


Equity Capital

Net worth

Long Term
Debt

Total
Sales
PAT
BV
(Rs)

EPS (Rs)

P/E

Industry
P/E

P/BV

Promoter’s
Stake
20.49 1016 1244 1509 62 50 3.03 51.32 15.97 3.11 37.5

 

Valuation Parameters

  1. EV/EBITDA: 24.25
  2. EV/Share: Rs 217
  3. EV/Sale: 2.94
  4. Market Cap/ Sale: 2.09
  5. Debt to Equity: 1.22
  6. RoI: 6.1 %
  • In September 2015, Orient Cement commissioned its new plant located near Chittapur, District Gulbarga, Karnataka and has an installed capacity of 3 million tonnes per annum (MTPA). The company now has a total capacity of 8 MT including the recently commissioned capacity in Karnataka. The company had invested Rs 2000 Crs in the Karnataka plant.
  • It sells 60% of its cement production in Maharashtra and close to 40% in Telangana. Nearly 80% of its sales are in the trade segment with a focus on rural housing.
  • Orient Cement has set a target of achieving 15Mt/yr production capacity by the end of 2020. The company is now looking at acquiring a few production plants with 2Mt/yr and 3Mt/yr production capacities in eastern India.

Recent Updates

  • The Company’s fourth-quarter net profit fell 77% to Rs 19 Crs from Rs 85 Crs in the same period last year, largely due to a sharp fall in realisation. Overall realisation was down 17%to Rs 3228 per tonne.
  • The ramp up of production at the new plant in Karnataka’s Gulbarga district is progressing well and helped achieve a volume growth of 40%.
  • The capacity utilisation has touched 44% at new plant, while it was 86% at the old plant. Overall capacity utilisation stood at 74%. The company targets 60% capacity utilisation at new plant for the coming year and 86-88% for the old plants.
  • For Q4 of FY 16, the company did a total volume of nearly 13.9 lakhs tonne. The company is targeting sales volume of 14.5-15 lakhs tonnes in coming quarters and also looking at higher usage of pet coke as cement plant stabilise.
  • Given the Debt to equity at 1.2, the company is comfortable with it and has no plan to bring it down in current year.
  • Remuneration paid to MD and CEO of the company for FY 16has exceeded the limit prescribed under section 197 read with the Schedule V of the Companies Act.
  • Aiming for 14.5-15 lakh tonne sales: Orient Cement

Bulk Deals

Date Company Client Transaction Quantity Traded Price (Rs)
15-May-2014 Orient Cement (NSE) Jhunjhunwala Rakesh Radheyshyam BUY 1710000 53.10
15-May-2014 Orient Cement (NSE) Nirmal Bang Securuties Pvt Ltd Error Account BUY 1050000 52.00
15-May-2014 Orient Cement (NSE) Nirmal Bang Securuties Pvt Ltd Error Account SELL 1050000 52.00

 

Block Deals

Date Exchange Quantity Price (Rs) Value(Rs Crs) Time
05-01-2016 BSE 500000 152.50 7.63 10:50
23-11-2015 NSE 350000 165.00 5.78 15:26
23-11-2015 NSE 400000 165.00 6.6 15:05
29-05-2015 BSE 970000 178.00 17.27 11:35
29-05-2015 NSE 1000849 178.00 17.82 11:35
22-05-2015 BSE 444207 185.00 8.22 13:58
22-05-2015 BSE 559167 185.00 10.34 13:57
23-01-2015 NSE 500012 188.95 9.45 13:33

 

Overview:

  • The company started its operations in 1982 and is engaged in the manufacture and sale of cement.
  • The Company’s manufacturing facilities are located at Devapur in Telangana and Jalgaon in Maharashtra.
  • The Company’s products include Birla A1 Premium Cement, Birla A1 Premium Cement-OPC 53 Grade and Birla A1 Premium Cement-OPC 43 Grade. The Company’s Greenfield cement plant, located near Chittapur, District Gulbarga, Karnataka, has an installed capacity of approximately three million tons per annum (MTPA).
  • The Company is part of the CK Birla Group, which operates in three industry clusters, including technology and automotive, home and building, and healthcare and education.
  • The Company operates through a network of over 40 offices.
  • Orient Cement operates largely in rural and semi-urban markets in Telangana and Maharashtra. Its target customer is the independent house builder in these markets. Therefore, dependence on the organised real-estate sector is small.

Management:

  • Mr C K Birla is the Chairman
  • Mr Desh Deepak Khetrapal is the MD and the CEO

 

Major Non – Promoter Holdings:

Sr No.  Non-Promoters % Stake
1 UTI-MID Cap Fund 1.22
2 Franklin Templeton Mutual Fund A/C Franklin India High Growth Companies Fund 1.81
3 Reliance Capital Trustee Co. Ltd.-A/C Reliancegrowth Fund 3.53
4 Reliance Capital Trustee Co. Ltd.-A/C Reliancesmall CAP Fund 1.5
5 ICICI Prudential Value Discovery Fund 2.03
6 Government Pension Fund Global 1.45
7 India Capital Fund Limited 1.9
8 Life Insurance Corporation of India 2.06
9 National Insurance Company Ltd. 2.37
10 ICICI Prudential Life Insurance Company Ltd. 1.61
11 HDFC Standard Life Insurance Company Limited 1.79
12 Jhunjhunwala Rakesh Radheshyam 1.22
13 Sri Govinddeo Educational Institute 1.47
14 Shri Venkateshwara Educational Institute 1.39
15 Rukmani Birla Educational Society 1.69
16 Shri Jagannath Educational Institute 1.55
17 Birla Institute of Technology and Science 1.72

 

Standalone Financial Trends ~ Amt in Rs Crs

  FY 16 FY 15 FY 14 FY 13
Equity Paid Up 20.49 20.49 20.49 20.49
Networth 1016 976 829 757
Long Term Debt 1244 1064 45 46
Total Sales 1509 1547 1430 1502
PAT 62 195 101 162
EPS (Rs) 3.03 9.52 4.93 7.91
Book Value (Rs) 50 48 40 37

 

  • The costs related to the commissioning/stabilisation of the new integrated unit at Chittapur (Karnataka) has affected the firm’s operating and net profit numbers in the last two quarters of FY16.
  • Increase in long term borrowing in FY 15 was to finance the new plant at Karnataka.

 

AYM Syntex Ltd

AYM Syntex Ltd
Textiles
FV – Rs 10; 52wks H/L – 163.5/39.55; TTQ – 5620; CMP (May 12, 2016) – Rs 103.8;
Market Cap – Rs 407 Crs

Standalone Financials and Valuations for FY16 (Amt in Rs Crs unless specified)


Equity Capital

Net worth

Long Term
Debt

Total  
Sales
PAT
BV
(Rs)

EPS (Rs)

P/E

Industry
P/E

P/BV

Promoter’s
Stake
39.24 194 167 801 48 49 12.23 8.49 32.58 2.12 70.1

 

Valuation Parameters

  1. EV/EBITDA: 4.97
  2. EV/Share: Rs 134
  3. EV/Sale: 0.66
  4. Market Cap/ Sale: 0.51
  5. Debt to Equity: 0.86
  6. RoI: 24.74 %

Bulk Deals

Date Company Client Transaction Quantity Traded Price (Rs)
03-Aug-2015 AYM Syntex (BSE) ASHISH RAMESHCHANDRA KACHOLIA BUY 289007 130.44
31-Jul-2015 AYM Syntex (BSE) ASHISH RAMESHCHANDRA KACHOLIA BUY 615143 124.32
30-Jul-2015 AYM Syntex (BSE) ASHISH RAMESHCHANDRA KACHOLIA BUY 295850 118.08
16-Jan-2015 AYM Syntex (BSE) SOMESH MEHROTRA BUY 331000 45.78

 

Insider Trades

Date Person  Buy / Sell Transaction Type  No of Shares Price (Rs) Value 
(Rs Lakhs)
Aug 24, 2015 VLS Capital Ltd  Sell Market 13,500 130.05 17.56
Aug 24, 2015 VLS Capital Ltd  Sell Market 36,500 130.05 47.47
Aug 24, 2015 VLS Capital Ltd  Sell Market 50,000 130.05 65.03
Aug 24, 2015 VLS Capital Ltd  Sell Market 1,00,000 130.05 130.05
Aug 24, 2015 VLS Capital Ltd  Sell Market 27,000 130.05 35.11


https://www.valueresearchonline.com/stocks/snapshot.asp?code=4442

  • VLS Capital held 1.36% stake in the company until September 2015.

Welspun Group is in process of carving out the yarn-spinning business, AYM Syntex, which will be managed by cofounder Rajesh Mandawewala’s elder son Abhishek. Rajesh Mandawewala, group managing director, is in the process of purchasing partner and Chairman BK Goenka’s stake in AYM Syntex. The arrangement shall lead to no change in the current promoter shareholding pattern of the group. Abhishek Mandawewala took over as a whole time director in August 2015. ~ Succession Planning: Welspun Group to hive off yarn-spinning business for next generation

 

Recent Updates

Overview:

  • AYM Syntex Limited, formerly Welspun Syntex Limited is a manufacturer and exporter of polyester texturized filament yarn and nylon filament yarn.
  • The Company operates through Synthetic Yarn segment.
  • The Company’s plants are located at Silvassa and Palghar in Thane, India. The Company’s product categories include bulk continuous filament yarn (BCF), polyester partially oriented yarn (POY), polyester fully drawn yarns (FDY), polyester mono filament yarns (PMFY), polyester filament yarn (PFY), polyester draw texturized yarn (DTY/PTY), air textured yarns (PATY) and specialty polyester filament yarns (SPFY).
  • Its POY category consists of products, including full dull raw white poy, semi dull raw white poy, bright raw white poy, super bright raw white poy, dope dyed black poy, dope dyed bright poy and bright cationic poy.
  • The Company’s PMFY category consists of products, including SEMI DULL Raw White, Bright Trilobal and Dope Dyed.
  • The Company is in the process of doubling capacity of BCF yarn, increasing capacity of texturized yarn, and mother yarn.

Welspun consolidating infra business, Apollo Global to get 12% of Welspun Projects 

Welspun to merge investment firms to unlock value, raise funds

 

Management:

  • Mr B A Kale is the Executive Director and the CEO.
  • Mr Abhishek Mandawewala is the Whole Time Director

 

 Shareholding Pattern as on March 31, 2016

 

The Equity Capital is @Rs 39.24 Crs consisting of 39239568 Equity Shares of FV Rs 10 currently held as under

 

None of the promoter’s holding is pledged

Sr No. Major Non-Promoter % Stake
1 Sanjeev Rajendraprasad Bharadia 1.04
2 Sadhana Mehrotra 3.44
3 Ashish Kacholia 4.85

 

Share Price Trend

 Standalone Financial Trends ~ Amt in Rs Crs

  FY 16 FY 15 FY 14 FY 13 FY 12 FY 11
Equity Paid Up 39.24 39.24 39.24 39.24* 23.64 23.64
Networth 194 146 113 108 79 74
Long Term Debt 167 127 116 95 50 29
Total Sales 801 835 896 776 612 503
PAT 48 43** 19 16 12 13
EPS (Rs) 12.23 10.96 4.84 4.08 3.06 3.31
Book Value (Rs) 49 37 29 28 20 19

 

  • Networth grew at a CAGR of 17.43% over the last six years while Total sales grew at a CAGR of 8% over the same period. PAT has grown at a CAGR of 24.32% in the same period.
  • *The Company had allotted 16000000 6% Optionally Convertible Cumulative Preference Shares of Rs 10 each at par to Krishiraj Trading Limited, promoter of the Company, which is to be converted into Equity Shares at any time within 18 months from the date of allotment @ Rs. 10.26 per share. The above shares were converted into 15594541 Equity shares at Rs. 10.26 per share on March 22, 2013. The paid up equity share capital thus increased from Rs 23.64 Crs in FY 12 to Rs 39.24 Crs in FY 13.
  • **Turnover of the Company reduced due to reduction in price of raw materials and finished goods following slash in price of crude oil. Concentration on high margin products, development of new products and production of BCF yarn coupled with reduction in prices of raw materials following slash in price of crude oil has increased profitabilityof the Company.