KESAR PETROPRODUCTS

Kesar Petroproducts Ltd. 
cmp :- 54
CODE - 524174

COMPANY OVERVIEW :-

•  Kesar Petroroducts Limited (KPL) was established in 2010 (incorporating the business of Shreyas Intermediates Limited) and was promoted by Mr. Dinesh Sharma.

• KPL is among the leading Indian manufacturers of Phthalocyanine Blue Crude and downstream products. KPL is presently a leading manufacturer of Phthalocyanine Blue Crude and its downstream products in India and contribute upto 15% of the entire Copper Phthalocyanine market of India enjoying a global presence in 15 countries. 

• Within the Pignments product basket KPL has a product Capacity (MTA) of CPC Blue Crude of 18,000 tpa, Alpha Blue 2,400 tpa & Beta Blue 3,600 tpa. In Dye intermediates it makes K - Acid 840, Gamma Acid 360, Vinyl Sulphone 1,200 and Sulpho VS 600. KPL has its plant located at Lote Parshuram in Maharashtra. 

• Recently KPL went in for a de-bottlenecking of its existing facility where in it commissioned a new 300 TPM beta facility in January 2017. KPL expects that this expanded plant will strengthen its business sustainability: as this facility represents a value addition over its established CPC manufacturing capacity where this plant was commissioned in eight months as against a prevailing benchmark of 18 months.

• KPL management believes that it has a significant market-leading role to play in this transformation and with a near-9% share of the global CPC market makes it one of the largest global players in this space; across the foreseeable future, wherein its expects to enhance its capacity utilisation and offer higher value addition with the objective to unlock value and emerge as one of the best known CPC players in the world coupled with a growing non-CPC play that enhances value for all the company’s stakeholders.  

💢 FUNDAMENTALS :-

Stock Info
Market Cap	522 Cr
P/E	20.30
52 W High/Low	74.80 / 29.50
Face Value	1
EPS	2.08
Book Value	7.05
Price/Book	7.66

💢 SHARE HOLDING :- 

Share  holding         June 17  PAttern		Sept 17
Promotors	31%	63.85
FII		1.24
DII
Public/NII	68.97%	34.9
TOTAL	100%	100%

Source :- Bseindia

ASPIRE EMERGING FUND bought 9,00,000 shares of KESAR PETROPRODUCTS LTD at Rs. 50.75

Principal Mutual fund bought 21 lacs shares of Kesar Petro 

Annual Report :- 
http://www.bseindia.com/bseplus/AnnualReport/524174/5241740317.pdf

Some key Highlights from Annual Report 2017 :- 

• The Company has been achieving steady growth in its sales over the last few years, a result of quality products delivery to customers.

• The Company’s exports as a percentage of revenues have been consistently high, indicating superior quality and export competitiveness.

• The Company has been achieving steady growth in its sales over the last few years, a result of quality products delivery to customers.

• Though the Company has shown a steady rise in the capacity utilisation, there is still an enormous untapped potential for aggressive expansion.

•  We believe that by 2019-20, Company’s fully-utilised capacities should be in a position to generate peak revenues of nearly 700 crore at margins higher than the prevailing levels

• The Company’s gearing moderated from a peak of 0.53 in FY14 to 0.44 in FY17.

• The Company’s profit after tax strengthened ~66%% in FY17, enhancing its accruals available for reinvestment.

• The Company’s net worth increased from C65.79 crore in 2015-16 to C88.23 crore in 2016-17

• The Company’s EPS strengthened from C1.31 in 2015-16 to C2.08 in 2016- 17 following an increase in profit after tax and no equity dilution.

• 1 Cr. Investment done during the year in Money market Fund.
  

Source : Annual Report 2017

💢 CLIENTS :-

Recent Bulk deal :- 

Source :- Bseindia

• Recently on 04/01/2018 company disclosed that Ms. Malvika Toprani aquired 40 Lakh shares on Kesar Petroproducts Ltd.

• MYRIAD BUSINESS ADVISOR LLP is a Limited Liability Partnership incorporated on 27 September, 2016 in Mumbai City, Maharashtra. The company has 2 Designated Partners

💢 Key Rationale :- 

• The Company has been achieving steady growth in its sales over the last few years.

• The Company’s exports as a percentage of revenues have been consistently high, indicating superior quality and export competitiveness.

• The Company’s operating profit grew substantially over the last four years.

• Though the Company has shown a steady rise in the capacity utilisation, there is still an enormous untapped potential for aggressive expansion.

• Near to 9% share of the global CPC market makes Kesar Petro as one of the largest global players in this space. we believe that compoany has a significant market-leading role to play in this transformation .

• we expect company will enhance its capacity utilisation and value unlocking and will emerge as one of the best known CPC players in coming years.

• Seeing a weakening in China’s CPC competitiveness; this is creating an attractive window of opportunity for robust Indian pigment manufacturers.

• Over the last few years, an increased investment in environment compliance within China’spigments sector coupled with a sharp increase in wages, has affected China’s global CPC market share. 

• An increase in capacity utilisation from 39.26% in FY17 (CPC including pigments) to ~45% in FY18 will result in enhanced output and profitability with a higher RoCE

• Two Big Mutual Fund has recently aquired stake in the company.

• Company has reduced debt.

• Promoter Stake Increased in Good Quantity from 31% to 63.85%.

• Company has a good return on equity (ROE) track record: 3 Years ROE 43.37%.

• Trading at PE of 20 vs Industry PE of 37.20

• KPL plans to launch two products in FY18 to create multiple revenue engine

Negative :- 

• 2 Big Investors accumulated recently. Though by seeing the past history of one non promoter make it risky.

• Company is not paying any dividend.

• Technically Stock is at Strong support of 54.

• Ascending Triangle Breakout possible above 58.

STOCK CAN BREAK ITS 52 WEEK HIGH  OF 74 WITHING LONG TERM AND CAN DO EVEN MORE IF CAPACITY UTILIZATION REACH TO ITS HIGHEST LEVEL, POSSIBLE TILL  FY19-20.

HAPPY INVESTING

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THE ABOVE IS NOT A RESEARCH REPORT NOT BUY/SELL RECOMMENDATION AND THIS IS ONLY FOR EDUCATIONAL PURPOSE , AND SOME OF MY FINDINGS FROM OPEN SOURCE. ONE CAN CONSULT THEIR FINANCIAL ADVISER BEFORE INVESTING.

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Happy Investing

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NOTE : THE ABOVE IS NOT A RESEARCH REPORT NOR A RECOMMENDATION  BUT INFORMATION AS AVAILABLE ON PUBLIC DOMAIN. 

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