Saturday, May 3, 2014

GUJARAT BOROSIL LTD - BUY
















Gujarat  Borosil Limited ( GBL) is a Company promoted by another  BSE listed company Borosil Glass Works limited (BGWL)  which is the leader in microwavable kitchenware   and laboratory glassware in India.BGWL holding close to 75% stake in Gujarat Borosil Ltd. Till 2010 GBLwas  manufacturing Sheet Glass and  later closed down this business  due to unprofitable operations.Thereafter company ventured into the manufacturing of  Low Iron Solar Glass which is used in Solar Photovoltaic Industry.GBL is the is the first and only manufacturer of solar glass in India and exporting  major portion of its products.As we are aware, European couturiers are the biggest users of Solar systems and this region was in a deep recession in last few years.Even in this tough business environment company could mark its presence in western market .In our country too the significance of solar energy is increasing and lot of scope left in this industry and company's product .Gujarat Borosil has the capacity to produce  more  than 4.2 million m2/ of glass per year. This is enough to help generate nearly 600 MW of solar power.Borosil specializes in producing 3.2mm and 4mm low iron glass widely used in the solar industry.In order to reduce its dependency on a single product ,last year company started the production of Patterned glass for Architectural applications. As per the available reports and feed backs from the market, this product is well accepted and it may help the company to turn around earlier than expected.

What attracted me to this company is its promoters flexibility and willingness to adapt quick changes in their strategy and even the product line to improve the performance of their companies. Take the case of its parent company Borosil Glass Works (BGWL) itself .About ten years back Borosil was a loss making company and its share price was below Rs.10 . Thereafter they identified some niche segments and turned to profit and now its stock price is quoting above Rs.1000 .I believe ,the current situation of Gujarat Borosil is almost same where Borosil  was 10 years back.Now the company identified two segments( solar glass and Patterned glass )  as growth engines . Potential of both these products are very  good  and with promoters  vast experience in glass industry Gujarat Borosil  may script a big success story few years down the line.Any serious  initiatives taken by the new government which is coming to power in near future to improve the usage of solar energy will change the future of this one and only maker of low iron Solar Glass in our country.



                                                   Click on the image for a better view


In latest December quarter ,company reported a net profit of Rs.1.72 Cr v/s a loss of Rs.63 Lakhs  reported in same period last year. This is a stock worth taking a risk but only for  those with enough patience.Stock is currently trading around Rs.8 and listed only in BSE.( Scrip Code -523768)

Link to Company Website HERE 


Link to Annual Report HERE

Suggested Reading for more Info 

1) Low Iron Glass for Concentrating Solar Power (CSP) – Markets to Reach $11.3 Billion By 2020
 
2) India's first low iron glass gets underway to serve crystalline PV module market


Disc: It is safe to assume that I have vested interest in GBL

41 comments :

  1. The balance sheet of the company is poor. Do you still recommend it..?

    ReplyDelete
    Replies
    1. I always prefer to give more weightage for company's future and not on the past while investing in these type penny stocks.If their past is also robust will they trade at this low price ?

      Delete
    2. What is your view of REI Agro

      Delete
  2. Good morning sir,
    you had asked to re-enter WPIL after profit booking pls see link below

    http://value-picks.blogspot.com/2012/03/wpil-re-enter.html

    THANK YOU

    ReplyDelete
    Replies
    1. If my memory is correct WPIL again touched Rs.450 in October 2012

      Delete
  3. Sir please please your view on bgr energy sre infrastructures and Maxwell industries kindly reply sir

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  4. Positive on BGR for long term ,not tracking others.

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  5. Excellent pick sir, I have already invested last month. So I am learning from you ...:)

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  6. I had bought few dividend yield stocks and now m able to get best value from it ... The stocks u mention don't pay dividend and its all a bet on future prospects .. If it clicks then it OK but if it doesn't it stays there or even lower for a long period ..
    Why don't consider revommeding a dividend play with a good growth prospects .. It some how closes the downside risk ..

    And more thing I noticed - u mention stocks which are illiquid or from t2t segment ..I agree there's money to be made in such stocks but risk is much more ...

    ReplyDelete
    Replies
    1. I think there is lot of risk free ways to earn 5-10 % yield outside stock market.

      Delete
    2. You're correct VALUEPICK, but what anonymous said is true, something which can provide safety and you still can ride when stock grows, may be that's not your style of investing though.Keep up the good work!

      Delete
  7. Sir,

    I think Borosil Glass Works sold land for over 600 crore a few years back and that money wasn't used in favor of minority shareholders. What is your view on the promoters with regard to this?

    ReplyDelete
    Replies
    1. But the promoters never siphoned the money from the company and the amount is still invested in various securities .Company is planning to utilise it for business expansion including overseas acquisitions

      Delete
  8. Sir
    Kindly provide the view on the Latest result of Paushak Ltd . The export is decreased and the domestic sale increased

    ReplyDelete
    Replies
    1. Result is below expectation,stock will correct.

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  9. sir can You tell me urs views about drdatson,is it a multibagger?

    ReplyDelete
    Replies
    1. I don't think that is easy under the current management of Datson

      Delete
  10. Dear Sir,
    Gujarat Borosil is showing net profit for last three qtr.but EPS calculated by company in minus side.Kindly let us know the reason for the same please.
    Regards
    Jitendra

    ReplyDelete
    Replies
    1. Explanation for the same is available as Notes No.2 of latest quarter result which is reproducing below.

      2. For the Limited purpose of calculating Earnings per share (EPS), proportionate dividend on Cumulative Preference shares has been taken into consideration. Due to this the EPS is showing negative figure despite the results being positive.

      Delete
  11. Dear Sir,
    Can u Lemme knw your views on Bharat Electronics & Sarda Energy

    ReplyDelete
    Replies
    1. Positive on Sarda Energy but stock moved up sharply in past few days .Better to enter after a correction and consolidation.

      Not tracking BEL

      Delete
  12. Dear VP, May I have your view on Firstsource solution ltd & Electrosteel steel Ltd from long term perspective?
    Regards, Suraj

    ReplyDelete
  13. Sir , do you track vbc ferro alloys. I am holding for years @550. Many analyst were positive and they told multi bagers. So I don't know how to analyse the stock or do homework. I invest based on analyst recommendation but no regrets. Just wanted to know the future whether I can hold or book loss. Thanks.

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  14. No meaning in blindly investing in any stocks only on the basis of advisers or analysts ,including me. Each and every client's/reader's risk profile may be different and one should decide whether the mentioned/recommended stock is suitable for own risk profile .For that one should do own home work in addition to the inputs provided by the advisor .Any advice is prone to mistakes,bias ..etc but hard earned money is yours and no advisor will take the responsibility of the loss ( If any ) .So your participation in acquiring knowledge about the company you are going to invest is very important.

    In case of VBC Ferro , there is chance for a sector re-rating in future but your purchase price is too high and not easy to reach there.

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  15. Sir, is excess dependence on Solar energy sector a risk for Gujarat Borosil? Are they developing other user sectors as well?

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  16. Please read the posting in full at least once.

    ReplyDelete
  17. Sir, can you please give your valuble views on Chamanlal Seti?
    Company looks promising..

    ReplyDelete
    Replies
    1. Chamanlal Sethia is a stock I recommended earlier .Link below

      http://value-picks.blogspot.in/2010/07/chamanlal-setia-exports.html

      Valuation wise stock is cheap ,but since the company is an agro based industry , weather conditions may create price sensitivity in its raw material especially at a time monsoon is predicted as below normal.

      Delete
  18. I am in process of buying saksoft now is any view change here. On Panacea is it still a buy

    ReplyDelete
    Replies
    1. If you not already entered in Saksoft ,nothing wrong in waiting for few more days . Election outcome may impact rupee value .

      Delete
  19. Sir,
    Any inputs on Siger India?

    Nilay Rahae, Kawla, Mumbai

    ReplyDelete
  20. Do you track Jai Balaji ? Is it a turnaround story ?

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  21. i missed to spot this when it was posted. and now the CMP is 11.66. would u recommend to take position at this level sir? kindly advise.

    ReplyDelete
  22. Not so good news for Gujarat Borosil.

    Despite a change in leadership in New Delhi, the gas woes of industrial units in Gujarat seem to be far from over. Now at least 30 industrial units, employing over 1.2 lakh people in South Gujarat, are staring at an imminent closure after Gas Authority of India Ltd (GAIL) has proposed 58 percent cut in supplies of APM (Administered Pricing Mechanism) natural gas from September 16, 2014, official sources from the industry said on Thursday.
    Among the industrial units --- most of which are into manufacturing glass and ceramics --- that are likely to be affected by the cut in gas quota include Gujarat Borosil Ltd which is the only producer of solar gas (used for solar panels, solar thermal heaters and green houses) in India.

    Source - http://www.financialexpress.com/news/industrial-units-in-south-gujarat-stare-at-58-pct-cut-in-natural-gas-supplies/1287968

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  23. VP Sir, Would love to hear your views for fresh entry into Gujarat Borosil @ Rs. 30.?

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  24. Already turning multibagger sir. Thanks for recommendation. Slow and steady wins the race.

    ReplyDelete
    Replies
    1. thaks for the recomandation of guj borosil

      Delete
  25. http://gujaratborosil.com/pdf/2016/corporate-announcement-and-others/Update-Regulation-30_23rd_May_2016.pdf
    disclosure for expansion of installed capacity submitted to BSE.

    ReplyDelete

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