adi finechem ppt v4 - moneybee · adi finechem ltd (13) basf india ltd (18) dic india ltd (22)...

Investment IdeaInvestment IdeaInvestment IdeaInvestment Idea

03-Mar-14 1

Investment IdeaInvestment IdeaInvestment IdeaInvestment Idea

Do You Know? Do You Know? Do You Know? Do You Know?

A company that in last 5 years has grown7777xxxx in market cap

4444xxxx in Revenue

12121212xxxx in EBITDA

6666xxxx in PAT

2 consecutive years of bonus

03-Mar-14 2

2 consecutive years of bonus

2 years of dividend

Shareholders wealth has increased at CAGR of 58.47%

How did the Company achieve this?How did the Company achieve this?How did the Company achieve this?How did the Company achieve this?

Niche products

Change of management in Feb 2010 – turning point

Fund infusion by new promoters

03-Mar-14 3

Fund infusion by new promoters

Promoter’s convictions

Clean Management

Market DataPrice Date 25/02/2014 Rs

Face Value 10

Market Price 109.9

Market Cap (Rs.Mn) 1,378

Equity Shares O/S (mn) 12.54

03-Mar-14 4

Equity Shares O/S (mn) 12.54

Book Value 29.96

52 Week High/Low 109.9/39.20

All time High/Low 109.9/1.36

P/E Ratio (TTM) 10.17

Promoter

63%FII

1%

Other

36%

Shareholding Pattern Dec 2013

Promoter FII Other

Market C

ap/TTM Sales

Market C

ap/TTM Sales

Market C

ap/TTM Sales

Market C

ap/TTM Sales

3.563.563.563.56

1.281.281.281.281.021.021.021.02

0.660.660.660.660.460.460.460.46 0.350.350.350.35

Pidilite Pidilite Pidilite Pidilite

Industries Ltd Industries Ltd Industries Ltd Industries Ltd

(4)(4)(4)(4)

Godrej Godrej Godrej Godrej


(11)(11)(11)(11)

Adi Finechem Adi Finechem Adi Finechem Adi Finechem

Ltd (13)Ltd (13)Ltd (13)Ltd (13)

BASF India BASF India BASF India BASF India

Ltd (18)Ltd (18)Ltd (18)Ltd (18)

DIC India Ltd DIC India Ltd DIC India Ltd DIC India Ltd

(22)(22)(22)(22)

Deepak Deepak Deepak Deepak

Nitrite Ltd Nitrite Ltd Nitrite Ltd Nitrite Ltd

(25)(25)(25)(25)

Market Cap/TTM SalesMarket Cap/TTM SalesMarket Cap/TTM SalesMarket Cap/TTM Sales

Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)

03-Mar-14 5

(4)(4)(4)(4) (11)(11)(11)(11) (25)(25)(25)(25)

* Source: List of Engineering Companies as per Capital Markets Magazine, Moneybee

Advisors

Ratios was 0.59 in

the end of FY10

0.590.590.590.59

1.021.021.021.02

2010201020102010 Q3FY14Q3FY14Q3FY14Q3FY14

Mkt Cap/ Sales RatioMkt Cap/ Sales RatioMkt Cap/ Sales RatioMkt Cap/ Sales Ratio

Price/Book Value

Price/Book Value

Price/Book Value

Price/Book Value

7.147.147.147.14

3.23.23.23.2 2.972.972.972.972.292.292.292.29

1.41.41.41.4 1.121.121.121.12



(3)(3)(3)(3)


Ltd (7)Ltd (7)Ltd (7)Ltd (7)



(9)(9)(9)(9)


Ltd (14)Ltd (14)Ltd (14)Ltd (14)



(21)(21)(21)(21)


(24)(24)(24)(24)

Price/BVPrice/BVPrice/BVPrice/BV

Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)Market Standing Chemicals Co (48)

P/BV terms company’s

standing end of FY13

was behind the BASF &

Godrej Ind.

P/BV terms company’s

standing end of FY13

was behind the BASF &

Godrej Ind.

03-Mar-14 6

31.8931.8931.8931.8930.2730.2730.2730.27

26.0226.0226.0226.02

20.3920.3920.3920.39

13.2613.2613.2613.2610.1710.1710.1710.17



(2)(2)(2)(2)



(4)(4)(4)(4)


(7)(7)(7)(7)


Ltd (9)Ltd (9)Ltd (9)Ltd (9)



(12)(12)(12)(12)


Ltd (14)Ltd (14)Ltd (14)Ltd (14)

TTM PETTM PETTM PETTM PE

TTM PE

TTM PE

TTM PE

TTM PE

* Source: List of Engineering Companies as per Capital Markets Magazine, Moneybee Advisors

(3)(3)(3)(3) (9)(9)(9)(9) (21)(21)(21)(21)

PE expansion mainly because

of growth company posted

PE expansion mainly because

of growth company posted

Competitive strengths Competitive strengths Competitive strengths Competitive strengths

Competitative

International

quality Plant

Technical KnowG

howLowGCost provider

03-Mar-14 7

Competitative

Strengths

No competition in

domestic Market

Goodwill

Skills in Manu.

high quality

product

What Next?What Next?What Next?What Next?

� Expansion in current facility with minimal capex

� The company planning to set up new facility

� Product expansion – more value added products

� ReGrating of stock

03-Mar-14 8

� ReGrating of stock

� Strong Balance sheet

� Environmental friendly initiatives

Value Explosion?Value Explosion?Value Explosion?Value Explosion?

We expect Market Cap

of the company to increase by

4x times

03-Mar-14 9

4x times

in coming

5 years

Company OverviewCompany OverviewCompany OverviewCompany Overview

� Manufacturing of speciality fine chemicals Viz. OleoChemical and Intermediate Neutraceutical & HealthProduct

� Adi Finechem Ltd. Was formally known as H.K Finechem

� Clientele include

� Riken Chemicals

� Cargill

Sole Manufacture of Mixed Tocopherol

03-Mar-14 10

� Cargill

� Cognis Corporation

� Tama BioGchemicals

� Asian Paints

� Goodlass Nerolac

� ADM

Tocopheroland Dimer Fatty

Acid in India

PRODUCTSPRODUCTSPRODUCTSPRODUCTS

Mixed Mixed Mixed Mixed

TocopherolsTocopherolsTocopherolsTocopherols

SterolsSterolsSterolsSterolsMonobasic Monobasic Monobasic Monobasic

AcidAcidAcidAcid

03-Mar-14 11

Products

DimerDimerDimerDimer AcidAcidAcidAcidLinoleicLinoleicLinoleicLinoleic

AcidsAcidsAcidsAcids

Financial OverviewFinancial OverviewFinancial OverviewFinancial Overview� Revenue has grown from Rs.580 mn in FY11 to Rs.1229 mn in FY13 at a CAGR

46%

� EBITDA has grown from Rs.103mn in FY11 to Rs.170.4mn in FY13 at a CAGR of 28%

� PAT has grown from Rs.51mn in FY11 to Rs.84mn in FY13 at a CAGR of 29%

03-Mar-14 12

For the 9Month ended FY14For the 9Month ended FY14For the 9Month ended FY14For the 9Month ended FY14

� Revenue has grown by 15% from Rs.936 mn in FY13 to Rs.1075 mn in FY14

� EBITDA has grown by 61% from Rs.136mn in FY13 to Rs.219mn in FY14

� PAT has grown by 112% from Rs.58mn in FY13 to Rs.123mn in FY14

Profit & Loss

DESCRIPTION MarG11 MarG12 MarG13 MarG14 MarG15A A A E P

Revenue 573.6 974.07 1228.7 1487.5 1902.7

EBIDTA (Ex OI) 104.8 142.1 170.4 313.4 419.9Margin 18.27% 14.59% 13.87% 21.07% 22.07%

Rs. Mn

03-Mar-14 13

Margin 18.27% 14.59% 13.87% 21.07% 22.07%

PBT 79.1 107.8 127.2 263.3 367.9Margin 13.79% 11.07% 10.35% 17.70% 19.34%

PAT 50.6 73.6 83.6 176.8 250.2Margin 8.82% 7.56% 6.80% 11.89% 13.15%

ContactContactContactContact

Dhiren Shah, MD

M. Com, LL. B, FCA, Grad CWA

dir: +91 22 4030 2001 m: +91 98337 70404

e: [email protected]

Ritesh Mistry, Sr. Associate

B. Com, MBA –Finance

dir: +91 22 4030 2052 m: +91 98921 46421

e: [email protected]

Moneybee Advisors Pvt Ltd

303, Tower A, Peninsula Business Park, G. K. Marg, Lower Parel(W), Mumbai 400 013

b: +91 22 4030 2010 f: +91 22 4030 2000

e: [email protected] w: www.moneybee.in

skype: moneybee.advisors tweet:@MoneybeeAdvisor

blog: moneybeeadvisors.wordpress.com

facebook: MoneybeeAdvisors linkedin: Moneybee Group

03-Mar-14 14

Disclaimer:1. This Report is prepared on the basis of the sources of information provided by the management of the Company. We have not independently verified any

of the information so provided.2. We assume no responsibility for the accuracy and completeness of information presented in this Report and will not be held liable for it under any

circumstances. We have not made an appraisal or independent valuation of any of the assets or liabilities of the Company and have not conducted an audit, or due diligence, or reviewed/ validated the projections/ financial data provided by the Management. We have relied on the judgment of the Management and auditors of the respective companies in understanding the contingency nature of liabilities; accordingly our valuation does not consider the assumption of contingency liabilities materializing.

3. Our analysis is based on the market conditions and the regulatory environment that currently exists. However, changes to the same in the future could impact the Company and the industry it operates in which may impact our valuation analysis.

4. For our analysis, we have relied on published and secondary sources of data, whether or not made available by the Company. We have not independently verified the accuracy or timelines of the same.

5. Neither Moneybee nor any of its affiliates are responsible for updating this Report because of events or transactions occurring subsequent to the date of this Report. Any updates or second opinions on this Report cannot be sought by the Management from external agencies including other offices of Moneybee without its prior written permission

adi finechem ppt v4 - moneybee · adi finechem ltd (13) basf india ltd (18) dic india ltd (22)...

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