Saturday, 30 May 2015

RESULT UPDATES: RICHA IND - PARNAX LAB - MINDTECK

RICHA INDUSTRIES LTD

  Richa Industries Ltd posted on the blog at 33 on 22nd January 2015.
Company has announced March 2015 quarter numbers today as follows.



The numbers are good if we look at them closely: The company has managed to surprise with topline growth, if we factor in bad last quarter the annual sales expected this time around were around 250 crores but it has surprised positively to cross 300 crores. Coming to the bottom-line it has contracted mainly due to other loss of 70 lakhs this quarter and for the March 2014 the company had got a tax writeback of 2.11 crores however this time it has paid taxes.
 
As company has already informed via the media that in FY16 it is going to be 70% PEB and only 30% Textiles which was almost 50:50 earlier. Company has plans to reduce or boot out textiles unit soon and maybe an textile unit sale will fetch good money to the company to reduce its debt drastically which is right now around 180 crores.

From the numbers it appears that PEB is doing well and the stock is now trading at only 6 p/e while unstable and sometimes loss making peer like Sahyadri is at 10 p/e and one of the sector leader Pennar Industries is at 17 P/E. Therefore, Richa is still a strong BUY for me at these dirt cheap levels.
 
Richa Industries has already submitted an application to list on National Stock Exchange and it is a trigger which will improve the rating of the stock and might take it at par with its peers.

For more details on the numbers I am planning to catch up with Mr Sandeep Gupta joint-md of Richa Industries soon and have a detailed QnA published on the blog soon.



PARNAX LAB LTD

  Parnax Lab Ltd posted on the blog at 41 on 19th February 2015.
Company has announced March 2015 quarter numbers as follows.

As seen above: The numbers are great. The sales have crossed the landmark 100 crore figure.
In the Parnax blog post i had written about expecting FY15 100 crores sales and the numbers have met it.

Looking at the sales growth of 50% and PAT growth of 70% everyone should be able to make out that this stock is a lot better than other Pharma stocks like Jagsonpal Pharma which is now trading at P/E valuation of 30 while Parnax which has recently witnessed fresh promoter buying from open markets is now trading at a P/E valuation of only 5.
 
If we expect atleast P/E of 15 for this successfully turned-out pharma company, the stock price should be at 75.

Its a clear buy and hold for me at these dirt-cheap valuations in an overall super expensive pharma sector.



MINDTECK (INDIA) LTD

  Mindteck (India) Ltd posted on the blog at 67 on 3rd December 2014.
 The stock is currently trading around 80, Corrected after touching high of almost 110 recently.

Company has announced March 2015 quarter numbers as follows.

The numbers are of great relief for shareholders. Mindteck which has largely been unstable right from FY10 till FY13 had only started the turn around in FY14 and now as the FY15 numbers are out the company has maintained the stability and now it looks like it should be growing going forward.

The flat sales and net profit number is nothing to worry about. The company has announced consecutive dividend for FY15 as well which provides an psychological relief to shareholders that these are not paper profits but actual.
 
The company has also made an announcement to the exchange that Mindteck is collaborating on FDA-Approved medial device. It is a remote patient monitoring project for a multinational corporation specializing in design and manufacturing of medical devices. It is an innovative, easy-to-use, FDA-approved device which will be used to attend medical incidents from various locations and will enable doctors to provide immediate assistance from anywhere.

The key features include: Real-time monitoring, Robust communication with other medical devices, Reliable data storage and representation, Medical data transfer, Data security and accuracy, Medical standards compliance.

Mindteck also boasts of having provided end-to-end for a variety medical device manufacturers for over two decades.

Mindteck is focused on e-governance and medical IT which includes device designing, manufacturing and software support.

Though most of Mindteck's earnings from Medical IT have been from overseas it is a fact that India is witnessing a shortage of medial devices and almost all of the medical devices which are used are imported which is why govt. has announced 100% FDI allowance in medical devices sector to encourage local manufacturing and the govt. is also going for an surveillance to track the quality of imported medial devices which are likely to have import bills at $4 billion by FY-18-19.

All in all i find results are stable and hence good for Mindteck which now looks like a very good company after stable financial performance for consecutive FYs.
 
 Stock is trading at a p/e of 10 which cannot be considered expensive and hence looks like a good BUY for long-term.

 

18 comments:

  1. Dear ACE,

    Recently Richa alloted 11,15,000/- equity shares to Promoters. You know what was the price.

    ReplyDelete
    Replies
    1. I don't think that allotment makes a huge difference to us.

      Delete
    2. The price is at 30.74

      Delete
    3. Hi Ace....
      Appreciate your effort in making understanding the performance....after ur recommendation started investing and analyzing the company...
      When we check the results of Richa ..textile business is also doing well but the profit margin is low when compared to PEB business.....and tried to check company announcement s on hiving off the textile business and couldnt find any references....have I missed the link ..please let me know so that I can go thru them....thanks in advance

      Delete
    4. Ace,
      Will it not dilute the equity??

      Delete
    5. Madhu it wasn't announced to exchange, please Google richa textile unit you will get the links from press.

      Delete
  2. Really very good analysis of results of Richa Industries, Parnax Lab. and Mindteck. All are looking strong multibaggers of next 1-2 yrs. Very best luck to theaceinvestor.

    ReplyDelete
  3. Parnax lab formed a hammer few days back chart also looking good if it close above 28 then it is bullish

    ReplyDelete
  4. Hello ACE,

    For Parnax I m confused if its a Pharma Co, because in money control below is mentioned

    Parnax Lab is in the Finance - Investments sector. The current market capitalisation stands at Rs 21.94 crore.

    Please help to clear my doubts

    ReplyDelete
    Replies
    1. Parnax is a pharma company, their website is down today maybe some technical issue.
      Regarding moneycontrol, Krishna Deep Finance was its old name i guess later on they got acquired and shifted to Pharma but moneycontrol is lazy to update the info :)

      Delete
  5. Dear ace,
    In case of Richa Inds, the debt is a alarming level of Rs 180 cr on a sales of 300 cr!

    Isn't that scary as its a small cap and relying on better economic conditions. ?

    ReplyDelete
  6. Dear Ace,
    I brought pranax @45 1000 share then i average it around 23, all other blogger and even friends suggest me to book loos , but i did not , because i have trust that it will perform more than Godavari drugs, now my confidant increased and i too hope it will touch 75. ACE ji thanks a lot for great picks and support.

    ReplyDelete
  7. Dear Ace,

    Is not better to wait for 2 more quarters and then enter if company keeps up growth rate. I don't mind paying more, let us say Rs 40. In that case we will be at minimum risk. Your comments please.

    Gopichand

    ReplyDelete
    Replies
    1. Which company are you talking about?

      Delete
  8. Sir ,Parnax Lab as you predicted sales cross 100 cr. mark ,really good prediction .But questions in mind then why any dividend not announced by company.

    ReplyDelete
    Replies
    1. Cannot expect dividend from a company just turning around, Parnax has been repaying its liabilities.

      Delete