Reviews

PRAJ INDUSTRIES 

Ticker : 522205 FV: Rs 2
52-Week H/L: Rs 131.50/61 

We had recommended Praj Industries in Volume No 34, Issue No 31 (dated May 21, 2018), when the scrip was trading at Rs 102. Our recommendation was backed by factors like robust growth in profitability. In Q1FY19, the company’s revenue was marginally up by 3 per cent, but its EBITDA grew exceptionally by 110 per cent on a YoY basis. The EBITDA margin improved from 1.8 per cent to 3.7 per cent. Also, the PAT jumped by 751 per cent to Rs 3.5 crore from Rs 0.41 crore on a YoY basis. Recently, the hike in ethanol prices declared by the government has boosted the sugar industry as sugar mills can produce more ethanol than before. Praj may leverage this opportunity and strengthen its market share. As our target price was achieved, we recommended investors to BOOK PROFIT in the scrip on Sept 17, 2018. 

KANSAI NEROLAC PAINTS 

Ticker: 500165 FV: Rs 1
52-Week H/L: Rs 608/437.50 

We had recommended Kansai Nerolac in Volume No 34, Issue No 43 (dated Aug 13, 2018), when the scrip was trading at Rs 515. Our recommendation was backed by factors like robust financial growth, foray into new markets and reduction of GST rates on paints. It has strong partnership with OEMs ranging from applications to cars as well as household. Maruti Suzuki is its largest client, which will continue to drive the revenue from the automotive segment. Under the decorative paints segment, as festive season is around the corner, Q2 and Q3 will deliver good numbers like every year. It has gained additional market share in the industrial coating segment. The capacity expansion would also drive the volumes of the company. Thus, we urge investors to HOLD the scrip at the current levels.