MNC’s always enjoying premium valuations in Indian Stock market ,especially companies operating from niche space.De Nora India (DNI) is a niche company commanding a market share of about 75% where it is operating , but overlooked by the investor fraternity- may be because of the complex nature of business in which it involved . This company is a 51.25% Subsidiary of Gruppo De Nora of Italy ,the world leader in design,erection and commissioning of electrochemical plants. DNI’s main business includes coating of anode and Cathode using in Chlor Alkali plants and corrosion systems used for preventing corrosion in SAW pipes ..etc. Along with this ,company is also supplying electro-chlorination equipments for purifying water for drinking and Industrial purpose. The erstwhile Mercury Cell technology used in our country is now gradually converting into Membrane Cell technology, which is opening huge chance for company’s product. Even if the new cells need not require coating in the initial few years of operation it should be coated periodically thereafter which is a big opportunity for the company. In last year DNIL introduced Platinized Titanium Anodes for surface finish application in India .Company’s factory located at Goa is equipped with most modern facilities and it is getting full support of its parent company. Lying of large network of pipelines in oil and gas sector,building of new bridges ,different type of concrete protection requirements ..etc are expected to bring good business for company’s Cathodic protection division.On the negative side ,company’s business have some cyclical nature,and is related with the fortunes of Chlor Alkali industry which is now started showing revival. Secondly there was an order against the company by the Directorate General of Supplies and Disposals, Ministry of Commerce and Industry which restricts the company from business with certain government departments for a period of five years .But, DNI challenged this order and in last month got an order stating that the time period reduced to just one year starting from 22.02.2010. Even if it may slightly affect the performance in very near future,there is good scope for its business in private sector and also in export front. FINANCIALS DNI’ financial year ending is in the month of December. Last financial year witnessed one of the worst performance in recent past where company posted a turnover of Rs.13.45 Cr and a net loss of Rs.33 Lac(excluding other income). But ,for the qtr ended June 2010 alone company posted a sales of Rs.4.74 Cr v/s Rs.2.29 Cr and a net profit of Rs 1.20 Cr v/s .58 Cr. Half year EPS is Rs.2.14 v/s Rs.1/- . Company is very liberal in dividend payment which paid 50% in 2004 ,70% in 2005 ,69% in 2006,58% in 2007,25% in 2008.In 2009, due to loss company skipped the dividend and it is expected to give higher yield in this year due to better prospects. Considering the support from the parent company which is the world leader, revival in the user industries ,chances of a turnaround performance ..etc company may turn as a multibagger going forward. CMP is Rs.79/-(Trading in both NSE and BSE)
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ReplyDeleteDear Mahesh
ReplyDeleteBan is only for one year and almost seven months already over.For details ,your mail id pls.
WOW, the latest UI is more pleasant to see and read. I have entered De Nora today at 79 levels.Hope it rocks like Vimal oil.
ReplyDeleteThanks Value Pick.
Sirji,
ReplyDeleteYou had given a BUY call for TIMEX at decline. Now it is trading around 41-42. Is it right time to enter or Should I wait further?
Dear Bubly
ReplyDeletestart with small lots.
Dear Sir,
ReplyDeleteWhat is your view on K S Oils Ltd? Shall we enter now?
Regards
Manjunath
Bangalore
Dear ValuePick
ReplyDeleteCan EPC be bought now and is it a multibagger in long term(2-3 years)
De nora declared a divided of Rs 5/.
ReplyDeleteYou have recommented this at Rs 79/- now quoting 92/- Is it a buy.
Vishnu R nair
Dear Value Pick,
ReplyDeleteI had entered De Nora on your recommendation at 79. Currently it is around 109. Please let me know if profits can be booked.
Thanks for your service and recommendations for small investors.
Regards
Rams
Hold De-nora
ReplyDeleteSir any update on de nota company
ReplyDelete