WIM PLAST - BOOK PATIAL PROFIT

I have recommended a BUY on Wimplast @ Rs.200  on July 5,2011 (For old posting click HERE).Today it touched its life time high @Rs.354/- and closed around Rs.330/- .Recommending to book at least partial profit.

NILKAMAL LTD / WIM PLAST LTD - Due for a Re- rating .

Even if there is different  opinions on Plastic , consumption of the same is surging every year. Convenience and low cost is the main reason for the growth of this sector .There is lot of plastic related product manufacturers in our country especially in unorganized sector.But they are not much bothered about branding and value addition.Nilkamal and Wimplast are two big players in branded and value added category in India . On conventional valuation parameters both these companies are qualifying for an  investment.Currently many of the companies from this sector other than VIP Industries are ignored by the market players . Both these company's financials are very solid and paying good dividend . I feels , in future there is every chance for a re rating in these companies as happened in kitchenware companies like TTK Prestige and Hawkins... Indian consumption theme is expected to auger well for these companies too in long run.

Wimplast - makers of CELLO brand -posted a turnover of Rs.158 Cr and a net profit of Rs.18 Cr . On an equity base of Rs.6 Cr it posted an EPS of Rs.30 in FY 2011. At current market price of Rs.200/-,Wimplast is trading at a P/E multiple of  6.6


Nilkamal  is the biggest player which posted a turnover of Rs.1252 Cr and a net profit of Rs.52 Cr . On an equity base of Rs.15 Cr it posted an EPS of Rs.37 in FY 2011.Company is rapidly expanding and its retail venture named @Home ( a one stop shop for all home needs) posted turnaround performance in FY 2011.

Both these company's are suitable for investors with medium to long term. Keep watching the raw material cost which is subject to the changes in crude price

CMP of Wimplast is Rs.202/- and Nilkamal is Rs.264/-