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Stock analysis-Radha Madhav
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This stock has been beaten down from its all time high in January 2008 of Rs.160 to Rs. 33 levels. The question that pops into my mind is " when is the best time to buy a stock- at its peak or at its bottom?" That is not too difficult to answer.
Radha Madhav Corporation Limited manufactures a range of packaging products in India. The company was incorporated in 2005 and is based in Kadaiya, India.
It offers three ply and four ply extrusion coated laminates used in bulk packaging of tea, contraceptives, and high barrier applications; multilayered n films for surface printing application used to pack oils, milk, and its derivatives and aqueous materials; and laminated film, rolls, pouches, and bags.
The company also manufactures cast stretch films; polypropylene bags, sheets, and liners; paper tubes and cores; continuous computer stationary; multi layered blown films for lamination; BOPP self adhesive tape; five-layered blown film; multi colored offset printed folded cartons; masking film; soft blister films; box straps; and identification tags.
Radha Madhav Corporation offers its products primarily to companies operating in food and beverages and pharmaceutical industries.
The Company is presently supplying secondary packaging material to the pharmaceutical industry, however, it is planned to supply for primary packaging material to pharmaceutical industry, and for that the company has set up expansion programme known as RADHA MADHAV CORPORATION LIMITED UNIT VI divided into two locations, one at Daman and another at Pantnagar in the State of Uttaranchal. The company will enjoy the various tax benefits and concessions granted by the Government.
OPERATIONS
Turnover for the year has been increased by 24.60% over the previous year (annualized). and profits before Tax jumped into more than double. The results are from the existing plant and machinery before implementation of expanded and new projects to be completed out off the funds raised by 1PO & Banks finance.
Reported Net Profit
Year Mar ‘05 Mar ‘06 Mar ‘07
INR (Crore) 0.08 3.02 6.06
Radha Madhav Corp. Ltd. has announced a 145% increase in net profit at INR 56.7 million for the quarter to Sep. 2007. Its sales increased by 90% to INR 392.3 million. The company’s operating profit increased by 163% to INR 91.9 million and profit before depreciation and tax, by 135% to INR 77.4 million.
Do you notice the growth here!
More about the Industry
Flexo Printed high-end barrier films are relatively newer product and there is lower competition in this industry. Neighboring countries do not have such manufacturing facilities and hence are potential unsaturated markets.
There is a big demand supply gap and hence increase in supply will be absorbed well.
With company’s existing expertise and deep market penetration, it expects lot of business shift from the existing supplier along with new demand.
Potential customer industry is highly quality sensitive as they thrive on their brand. By purchasing a highly sophisticated and s |
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