Suresh Agarwal: This Kolkata-based small-cap investor acquires a stake in this low P/E and high ROCE company; stock jumps 8 per cent
Suresh Kumar Agarwal, with his keen eye for opportunities, currently holds a 1.04 per cent stake in the company, equating to 183,000 shares
In the world of stock markets, where fortunes are won and lost in the blink of an eye, there exists a realm of quiet and strategic investors who prefer to operate in the shadows, away from the glitz and glamor of D-Street. Suresh Kumar Agarwal, a man of many talents, is one such enigmatic figure hailing from the vibrant city of Kolkata, where he orchestrates his financial symphony through the Agarwal Family Office.
While the majority of investors are drawn to the allure of high-profile stocks and blue-chip giants, Suresh Kumar Agarwal has carved out a unique niche for himself by specializing in the art of picking Small-Cap stocks. These stocks, often overshadowed by their larger counterparts, hold immense potential for growth, and Mr. Agarwal is a master at unearthing these hidden gems.
Recently, the financial world took notice as Mr. Agarwal's name became associated with a remarkable find – Styrenix Performance Materials Ltd. (SPML), a Gujarat-based company specializing in the manufacture of ABS, SAN, and polystyrene. It's a company that might have flown under the radar for many, but it holds immense promise.
SPML's journey dates back to December 7, 1973, when it was originally incorporated as 'ABS Plastics Ltd.' by Rakesh Agarwal and his family members. Over the years, the ownership of the company passed through various international chemical groups before ultimately landing in the hands of the INEOS Group through its step-down subsidiary, Ineos Styrolution APAC Pte Ltd. (ISAPL), which held a majority stake of 61.19%.
The turning point for SPML arrived on August 1, 2022, when Shiva Performance Materials Private Limited (SPMPL), owned by Rakesh Agarwal and family, entered into a share purchase agreement with ISAPL. The result was the acquisition of ISAPL's entire equity stake in SPML, giving SPMPL controlling ownership. This change was followed by a board of directors' overhaul in November 2022 and a rebranding of the company to Styrenix Performance Materials Ltd. in January 2023.
What sets SPML apart is its unrelenting commitment to excellence in the field of ABS and SAN manufacturing. They produce various grades of ABS under the 'Absolac' brand and SAN under 'Absolan.' These versatile engineering thermoplastic materials find applications in a wide range of industries, including electrical and electronics, automotive, household consumer durables, information technology, stationery, cosmetic, packaging, toys, and more. Their high-impact, ignition-resistant properties make them sought after in diverse market segments.
As of the latest available data, SPML stock has surged by over 8 per cent, trading at Rs 1,130 per share. Suresh Kumar Agarwal, with his keen eye for opportunities, currently holds a 1.04 per cent stake in the company, equating to 183,000 shares. The stock maintains a price-to-earnings (PE) ratio of 15.3x and boasts a robust return on equity (ROE) of approximately 23 per cent. Notably, the stock appears to be trading around its intrinsic value, indicating the potential for further growth.
In the world of finance, where the stock market is often viewed as a high-stakes battleground, investors like Suresh Kumar Agarwal bring a different perspective. They see potential where others might not and are not swayed by the glimmers of the mainstream. Their patient and methodical approach to small-cap stocks can lead to astonishing successes, and SPML seems poised to be one such success story.
If you're eager to delve deeper into the enigmatic world of Suresh Kumar Agarwal and his astute investment strategies, make your interest known in the comments section. After all, the stock market is not just about making money; it's about the fascinating stories of individuals who excel in the art of financial alchemy, turning lesser-known stocks into treasures.
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Disclaimer: The article is for informational purposes only and not investment advice.