We have already discussed another stock from this same
sector – Sukhjit Starch-around Rs.169 ( Old posting HERE) which reached a high of Rs.275 and
currently trading around Rs.215.As in the case of Sukhjit ,ANIL LTD is a large
listed player in starch and starch derivatives industry. This company belongs
to Ahmedabad based ANIL group having diverse interest in Biotechnology,Food
Processing ..etc.Company manufacturing Native Starch, Chemical Starch, Modified Starches, Dextrins,
Dextrose Monohydrate, Liquid Glucose, Corn Syrup, and Sorbitol ..etc. These
products are mainly used in Textile,Pharmaceutical, Paper and Food &
Beverages industries. ANIL exporting many of its value added products to various overseas markets.Recently company established an SPV to set up a mega food park in
Vadodara ,Gujarat.Growth of user industries and price flactuation of raw
material is points to note.For the past few months raw material price was high
due to lower mansoon in last season.But company could report satisfactory
performance with higher top line even its margin impacted due to this
factor.Company reported a turnover of Rs.226 Cr v/s Rs.158 cr in December
quarter alone .Net profit was flat around Rs.13-14 Cr .For the last financial
year company reported a turnover of
Rs.645 Cr ,net profit of Rs.50 Cr and an EPS of Rs.52 /- .At current market price of Rs.199 , Anil is trading at a P/E
multiple of just 4 which is at the lower end for a dominent player in this
industry.A better mansoon in India for the next season or an improved out look of corn production in
international market will help the
company to reduce its raw material cost.At current market price I feel there is
value in it.Recommending an entry for long term investors @ CMP RS.199 and any dip due to
over all sell off in mid caps (if any) may take as a chance to add more .
Link to Company website HERE
