Reviews
We had recommended Finolex in volume 33, issue no. 20, dated Sept 3-16, 2018, under the ‘Choice Scrip’. The stock was trading at Rs. 602.65 then and was recommended owing to favourable economic factors, shift from B2B and B2C and company’s production capacity expansion.
Finolex Industries Ltd is a PVC pipe manufacturer in India. The company’s product range includes PVC resin, PVC-U pipes and fittings, Selfit PVC-U pipes (for agriculture and potable water supply), Ringfit PVC-U pipes (for agriculture and potable water supply), moulded fittings for agriculture, etc. These products are used as solvents in the pharma, fertiliser, paints, lamination, amines and various other industries in India. The company is also in the business segment of PVC, power, pipes and fittings.
On the financial front, the net sales for Q4FY19 stood at Rs. 964 crore, up by 19 per cent, from Rs. 809.12 crore posted in the same quarter of the previous year. The company reported PBIDT of Rs. 146.48 crore for Q4FY19, posting a drop of 22.02 per cent from Rs. 187.86 crore posted in Q4FY18. The PAT dropped by 24 per in Q4FY19 to Rs. 91.38 crore from Rs. 120.94 crore posted in the corresponding quarter of the previous year.
On the annual front, the net sales were at Rs. 3,091.32 crore, up by 9.18 per cent in FY19 as against Rs. 2,831.41 crore posted in FY18. The PBIDT was Rs. 604.30 crore, up by 24.87 per cent in FY19 as compared to Rs. 483.93 crore in FY18. The PAT has climbed up 17 per cent to Rs. 349.80 crore in FY19 as opposed to Rs. 298.55 crore in FY18. Since our recommendation, the stock has fallen by 16.99 per cent. The company would be a major beneficiaries from government’s focus on irrigation and improvement in rural consumption in the long term. With the company’s focus on expanding product range across both agri and non-agri pipes in the longer run. We recommend a HOLD as we expect a revival in the stock price in the near future owing to the robust financials.
We had recommended Bandhan Bank in volume 34, issue no. 2, dated Dec 24,2018-Jan 6, 2019, under the ‘Choice Scrip’. The stock was trading at Rs. 545.40 then and was recommended owing to strong balance sheet, gain in its market share in micro loans and for its aim of opening 40 new branches.
Bandhan Bank currently offers a variety of asset and liability products and services designed for micro banking and general banking, as well as other banking products and services to generate non-interest income.
On the financial front, the interest earned by the bank in Q4FY19 was Rs. 1832.68 crore, up by 35.69 per cent from Rs. 1350.59 crore posted in the same quarter of the previous year. In terms of operating profit, the bank witnessed a jump of 63 per cent to Rs. 1,153.20 crore in Q4FY19 as compared to Rs. 703.80 crore posted in Q4FY18. The PAT grew over 67 per cent to Rs. 650 crore in the fourth quarter of FY19 as opposed to Rs. 387 crore posted in the corresponding period of the previous fiscal.
On the annual front, the interest earned in FY19 was Rs. 6,644.05 crore, up by 38.35 per cent from Rs. 4,802.30 posted in FY18. The operating profit in FY19 was Rs. 3,748 crore, up by 54 per cent from Rs. 2,430 posted in FY18. The PAT was Rs. 1,951.50 crore in FY19 as against Rs. 1,345.56 crore, showing a growth of 45 per cent annually. Since our recommendation, the stock has fallen by 2.49 per cent. However, we recommend a HOLD owing to the strong financials.
(Closing price as of June 18, 2019)