Firstcall recommend Alkyl Amines Chemicals for Medium to Long term Investment

Firstcall India Equity | April 15, 2016, midnight


SYNOPSIS


-   Alkyl Amines Chemicals Limited is a global supplier of amines and amine-based chemicals to the pharmaceutical, agrochemical, rubber chemical water treatment industries, among others.


-   During Q4 FY16, the company’s net profit jumps to Rs. 153.78 million against Rs. 119.65 million in the corresponding quarter ending of previous year, anI increase of 28.53%.


-   Revenue for the quarter rose by 2.86% to Rs. 1210.37 million from Rs. 1176.77 million, when compared with the prior year period.


-   For the quarter Q4 FY16, EBITDA stood at Rs. 275.09 million as against Rs. 222.72 million in the corresponding period of the previous year.


-   During Q4 FY16, Profit before tax grew 32.21% at Rs. 226.16 mn against Rs. 171.06 mn in Q4 FY15.


-   EPS of the company stood at Rs. 7.53 during the quarter, as against Rs. 5.86 per share over previous year period.


-   Revenues for F Y2015-16 increased by 2% and I stood at Rs. 4835.94 mn as compared to Rs. 4763.66 mn in FY2014-15.


-   During the year ended 2015-16, Net Profit increased by 10% to Rs. 498.55 mn from Rs. 454.21 mn in the previous year ended FY2014-15.


-   Net Sales and PAT of the company are expected to grow at a CAGR of 6% and 12% over 2015 to 2018E respectively


OUTLOOK AND CONCLUSION


-   At the current market price of Rs.312.40, the stock P/E ratio is at 10.88 x FY17E and 9.56 x FY18E respectively.


-   Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 28.70 and Rs. 32.69 respectively.


-   Net Sales and PAT of the company are expected to grow at a CAGR of 6% and 12% over 2015 to 2018E respectively.


-   On the basis of EV/EBITDA, the stock trades at 6.86 x for FY17E and 6.05 x for FY18E.


-   Price to Book Value of the stock is expected to be at 2.69 x and 2.29 x for FY17E and FY18E respectively.


-   Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.


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